Consider a coupon bond that has a $900 par value anda coupon rate of 6%. The bond is currently selling for$860.15 and has two years to maturity. What is thebond’s yield to maturity?
Debenture Valuation
A debenture is a private and long-term debt instrument issued by financial, non-financial institutions, governments, or corporations. A debenture is classified as a type of bond, where the instrument carries a fixed rate of interest, commonly known as the ‘coupon rate.’ Debentures are documented in an indenture, clearly specifying the type of debenture, the rate and method of interest computation, and maturity date.
Note Valuation
It is the process to determine the value or worth of an asset, liability, debt of the company. It can be determined by many processes or techniques. Many factors can impact the valuation of an asset, liability, or the company, like:
Consider a coupon bond that has a $900 par value and
a coupon rate of 6%. The bond is currently selling for
$860.15 and has two years to maturity. What is the
bond’s yield to maturity?
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