A coupon bond pays this amount every 6 months;   $             30.00 bgs         for the number of payments/year;                         2         The bond also pays at maturity the par (face) value;  $       1,000.00         Number of years until maturity                         15         The required return of holders of this bond is;  8.00% bgs     a) What is the PV of the CFs, or what would be the fair price to purchase this bond?                       b) If the required return of holders of this bond is;  6.00% bgs       What is the PV of the CFs, or what would be the fair price to purchase this bond?                       c) If the required return of holders of this bond is;  4.00%         What is the PV of the CFs, or what would be the fair price to purchase this bond?  to purchase this bond?

Q: 1. A 12-year bond has a 9 percent annual coupon, a yield to maturity of 8 percent, and a face value…

A: 1) Face value (F) = P 1000 r = YTM = 8% n = 12 years Coupon (C) = 9% of 1000 = P 90

Q: Assume that you are considering the purchase of a 20-year, noncallable bond with an annual coupon…

A: Present Value can be calculated using PV function in excel   PV (rate, nper, pmt, [Fv], [type])…

Q: What is the bond's nominal coupon interest rate?

A: Answer:- 9.72% FV= 1000 Semi annual N=30*2=60 YTM=10.55/2=5.275%

Q: a. What is the duration of a two-year bond that pays an annual coupon of 11.5 percent and has a…

A: A financial instrument that doesn’t affect the ownership of the common shareholders or management of…

Q: You are considering a 10-year, $1,000 par value bond. Its couponrate is 8%, and interest is paid…

A: The computation of nominal rate: Hence, the nominal rate is 7%.

Q: Violet Inc. bonds currently sell for P1,500 and the same bond was originally sold at P1,500. This…

A: Current price = P1500 Original price = P1500 Annual coupon payment = P37.50 Period = 5 Years

Q: Bond P is a premium bond with a coupon rate of 8 percent. Bond D is a discount bond with a coupon…

A: A Capital Gains yield is a rise in the price of a security such as stock, bond etc.

Q: What is the Macaulay duration of a 3% bond with 3 years to maturity, discounted at a rate of 2% per…

A: Macaulay duration shows the time period required by investor to recover his invested amount in the…

Q: A four-year bond with a yield of 10% (continuously compounded) pays an 20% coupon at the end of each…

A: Time to maturity is 4 years Bond yield is 10% continuously compounded coupon rate is 20% Par Value…

Q: hi there,  a-)What is the duration of a two-year bond that pays an annual coupon of 11.4 percent…

A: a) Duration of a two-year bond = 1.5 year.  Workings:  Present value = Cash flow(1+in)n Compute…

Q: What is the price of the bond? b. If the rate of interest increases 1 percent, what will be the…

A: NOTE: As per our policy, we only answer up to three sub-questions. Therefore the first three…

Q: A P1,000 par value, 12-year annual bond carries a coupon rate of 7%. If the current yield of this…

A: Bond Valuation will be done with the help of NPV method of Capital Budgeting under NPV method we…

Q: what is the par value of the bond?

A: Bond valuation refers to a method which is used to compute the current value or present value (PV)…

Q: A 15 year, semi-annual bond has a coupon rate of 4%. The YTM is 4%. What is the bond's duration and…

A: Given: Years = 15 Coupon rate = 4% YTM = 4%

Q: You buy a 6 year bond with an annual 5% coupon at par value, $1000. If the yield to maturity at the…

A: Solution: Bond value is the present value of the cash inflows receivable from the bond for the…

Q: 1.  If the yield to maturity for a two year zero coupon bond is 5.8% and the yield to maturity for a…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: A bond has a 25-year maturity, an 8% annual coupon paidsemiannually, and a face value of $1,000. The…

A:

Q: 00 face value bond has 15 years to maturity and a 7.6% coupon rate (interest is paid annually).  If…

A: Yield to maturity is rate at which present value of coupon payment and present value of par value…

Q: A bond promises to pay you $7,000.00 in earn 6 percent on securities of equal risks, what would be…

A: The present value of the bond shall be equal to the face value of the bond discounted at the…

Q: What is the yield to maturity at a current market price of RM799?

A: Yield To Maturity: Yield to maturity is the amount that a bond is expected to yield after a certain…

Q: Consider a Treasury bond with 8% coupon rate and 4 years to maturity (annual coupons). You enter…

A: Forward price is the price at which the buyer will buy the underlying asseat a future date. This…

Q: Assume that you are considering the purchase of a 20-year, noncallable bond with an annual coupon…

A: Maximum Price of Bond = Present Value of future cash flows of bond (discounted at required yield)…

Q: the following features: • Coupon rate of interest (paid annually): 10 percent • Principal: $1,000 •…

A: Bond is a type of debt security which carry fixed income i.e. interest. Bond are issued by…

Q: suppose a ten-year, 1,000 bond with an 8.8% coupon rate semiannual coupons is trading for $1,035.89…

A: Time Period (Years) (NPER) 10 Face Value (FV)  $    1,000.00 Coupon Rate (PMT) 8.80% Current…

Q: A newly issued bond pays its coupons once annually. Its coupon rate is 5%, its maturity is 20 years,…

A: Hi there, thanks for posting the questions. But as per our Q&A guidelines, we must answer the…

Q: Assume that you are considering the purchase of a 20-year, noncallable bond with an annual coupon…

A: Price of the bond is calculated as the sum of the present value of all the coupons and maturity…

Q: What is the semi-annual coupon bond’s nominal yield to maturity (YTM), if the years to maturity is…

A: Hi there! Thanks for the question. Post has multiple questions. As per company guidelines expert can…

Q: Suppose a 2 year bond with F = C = 1000, and a nominal annual coupon rate convertible semian- nually…

A: Face value (F) = 1000 Coupon (C) = (10% of 1000) / 2 = 50 n = 2 years = 4 periods r = YTM = 8% per…

Q: What is the bond's nominal yield to call?

A: Given, coupon = 8.25% semiannual YTM = 6.5% call Price = 1120 FV = 1000 maturity = 15 years year to…

Q: Suppose a ten-year, $1,000 bond with an 8.5% coupon rate and semiannual coupons is trading for…

A: Here,

Q: Bond A is a $1,000, 6% quarterly coupon bond with 5 years to maturity. (a) If you bought Bond A…

A: Hey, since there are multiple questions posted, we will answer first three question. If you want any…

Q: For the following questions, assume the normal case that coupon payments are semi-annual. a. What is…

A: For annual rate of return from bond, first we need to use PV function in excel to calculate bond…

Q: Luna Inc. bonds currently sell for P1,500 and the same bond was originally sold at P1,500. This…

A: Originally sold price = P1500 Annual coupon payment = P37.50 Current price = P1500

Q: For the following questions, assume the normal case that coupon payments are semi-annual. a. What is…

A: N = 12 years Coupon Rate = 6.2% Price = 1000 Face Value = 1000

Q: Bond P is a premium bond with a coupon of 7.8 percent, a YTM of 6.55 percent, and 15 years to…

A: Bonds are the highly secured debt securities for which the company pays interest to the bondholder.…

Q: Suppose that a 1-year zero-coupon bond with face value $100 currently sells at $94.34, while a…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: sume that you are considering the purchase an AEP 30-year, bond with an annual coupon rate of 8.22%.…

A: Maximum price of the bond will be present value of all the future cash flows associated with the…

Q: You have a bond with the following features: - Semi-annual coupon payments. - Coupon rate 7.60%.…

A: Macaulay Duration is calculated using the below formula: Modified Duration:

Q: What is the value of a Northern Pacific bond with an 11 percent coupon, maturing in 15 years? Assume…

A: Using excel PV function

Q: The brownstone corporation`s bond have 5 years remaining to maturity.

A: Yield to Maturity: Yield to maturity is the discounted rate of all the future cash flows from the…

Q: Suppose a ten-year, $1,000 bond with an 8.8% coupon rate and semiannual coupons is trading for…

A: Time period = 10 year  Coupon rate = 8.8%  Selling price = $1,034.64

Q: A 2-year zero-coupon bond with $100 principal is trading at $95.00. Price of a 2-year coupon bond…

A: In this given question we, need to calculate the spot rate for a Zero coupon bond and the spot rate…

Q: What is the bond's price?

A: Information Provided: Years to maturity = 10 Coupon rate = 6.25% semiannual  Par value = $1000…

Q: A 3-year bond pays annual coupons at 5%. lts par value is $1000. If its yield to to maturity is 4%,…

A: Macaulay Duration is calculated using the below formula. Here, ti = time till cash flow PVi =…

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: