Suppose a​ seven-year, $1,000 bond with a 11.53% coupon rate and semiannual coupons is trading with a yield to maturity of 9.06%. Is this bond currently trading at a​ discount, at​ par, or at a​ premuim? Explain. The bond is currently trading...  ​(Select the best choice​ below.)             A.... at a discount because the coupon rate is greater than the yield to maturity             B.... at a premium because the yield to maturity is greater than the coupon rate             C.... at par because the coupon rate is equal to the yield to maturity             D.... at a premium because the coupon rate is greater than the yield to maturity 2. If the yield to maturity of the bond rises to 9.85% (APR with semiannual​ compounding), at what price will the bond​ trade?

Q: (Click on the following icon in order to copy its contents into a spreadsheet.) Years to Yield to…

A: using excel rate function to calculate YTM of the bonds

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Q: on the following icon in order to copy its contents into a spreadsheet.) Maturity (years)…

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Q: |(Click on the following icon 9 in order to copy its contents into a spreadsheet.) Years to Yield to…

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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: