ind the yield to maturity (YTM) for a 10-year, 5% annual coupon rate, $1,000 par value bond if the bond sells for $918 currently? We assume that interest is paid on this bond annually. 6.12% 6.91% 7.33% 7.86% Using the information from Question 38, calculate the bond’s current yield. 5.00% 5.45% 6.50% 8.21% Using the information from Question 38 and 39, calculate the bond’s capital gain yield.
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:
Find the yield to maturity (YTM) for a 10-year, 5% annual coupon rate, $1,000 par
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6.12% |
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6.91% |
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7.33% |
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7.86%
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Using the information from Question 38, calculate the bond’s current yield.
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5.00% |
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5.45% |
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6.50% |
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8.21% |
Using the information from Question 38 and 39, calculate the bond’s
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-0.35% |
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0.35% |
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0.67% |
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-0.67% |
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