AB Bank has AAA-rated, 15-year zero-coupon bonds with a face value of $400 million. The bonds currently are yielding 9.5 percent in the over-the-counter market. a)- What is the 10- day VAR for these bonds? b)- What is the DEAR?

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A: Semiannual interest = Par value * Rate * Time Semiannual interest = $1,000 * 0.10 * 6/12 Semiannual…

Q: Octopus Transit has a $1,000 par value bond outstanding with 10 years to maturity. The bond carries…

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Q: Nesmith Corporation's outstanding bonds have a $1,000 par value, an 10% semiannual coupon, 20 years…

A: Yield to maturity (20*2) 40 coupon amount (PMT) = 10%*1000/2 50 Face value (FV) 1000 Yield…

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Q: How many OID bonds must the firm issue to raise the other $3 million?

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Q: arshall Company is issuing eight-year bonds with a coupon rate of 7.85 percent and semiannual coupon…

A: Data given : Face value of bond =$1000 (assumed) n= 8 years x 2= 16 periods ( as payment is made…

Q: Two years ago, Company XYZ issued $100 million worth of ten-year bonds with a face value of $1,000…

A: Bond is a financial instrument that gives bondholder a legal right of receiving payments on regular…

Q: Blakemore Inc.'s $1,000 face value bonds mature in 12 years and currently sell for $1,055.00. They…

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Q: Lackson PLC and Hardy Corp. both have 8 percent coupon bonds outstanding, with semiannual interest…

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Q: Harrimon Industries bonds have 6 years left to maturity. Interest is paid annually, and the bonds…

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A: Sensitivity of the bond price means the change in bond price. If the bond price increases then the…

Q: Showbiz, Inc., has issued eight-year bonds with a coupon of 6.73 percent and semiannual coupon…

A: given, n=8 coupon rate = 6.73% semi annual coupon r=7.51% par = 1000 m=2

Q: Laurel, Inc., and Hardy Corp. both have 6 percent coupon bonds outstanding, with semiannual interest…

A: The question is based on the concept of the valuation of bonds.

Q: what is the current market value of Elite's bond?

A: Number of periods = (20 - 9) * 2 = 22 Semi annual rate = 8% / 2 = 4% Semi annual coupon = [(7 / 100)…

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Q: Wisteria Company has some $1,000 par value bonds outstanding which pay a 14 percent annual coupon…

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Q: Ryngaert Inc. recently issued noncallable bonds that mature in 15 years. They have a par value of…

A: A bond is a fixed-income investment that symbolizes the debt owed by an investor to a third party. A…

Q: Lanker Enterprises has bonds on the market making Monthly payments, with 16 years to maturity, a par…

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Q: Maroon Two Inc. has just issued 10,000 coupon bonds with face value of $1,000, coupon rate of 9%,…

A: Bond price is defined as the present discounted value for the future cash stream, which used to be…

Q: Russell Container Corporation has a $1,000 par value bond outstanding with 30 years to maturity. The…

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Q: Charlton Wineries (CW) has outstanding 10-year, €1,000 face value bonds with a 6% coupon rate…

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A: The term bonds refer to the debt instruments that are issued with a motive to raise debt from the…

Q: Too Young, Inc., has a bond outstanding with a coupon rate of 7.3 percent and semiannual payments.…

A: using excel rate function

Q: Nesmith Corporation's outstanding bonds have a $1,000 par value, a 10% semiannual coupon, 19 years…

A: Information given in the question is as follows: Par Value = $1000 Coupon Rate = 10% Coupon…

Q: Two years ago, Company XYZ issued  $100 million worth of ten-year bonds with a face value of…

A: The market price is the present value of the coupons and the principal payment, at the rate of…

Q: Nesmith Corporation's outstanding bonds have a $1,000 par value, a 11% semiannual coupon, 20 years…

A: Computation of bond price: Hence, the bond price is $1,041.47.

Q: Sanibel Industries has $1000 par value bonds with a coupon rate of 7% per year making semiannual…

A: Par Value = 1000 Semi Annual Coupon Payments Coupon = Coupon Rate / 2 * Par Value = 7%/2 * 1000 = 35…

Q: Marshall Company is issuing eight-year bonds with a coupon rate of 6.19 percent and semiannual…

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Q: Kholdy Inc's bonds currently sell for $1,275. They pay a $120 annual coupon and have a 20- year…

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Q: The duration of these bonds is 8.1702 years. What are the predicted bond prices in each of the four…

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Q: Lifehouse Software has 10 percent coupon bonds on the market with 7 years to maturity. The bonds…

A: In this question we need to compute the current yield on Lifehouse's bonds.

Q: ABC Bank has a AAA-rated, 15-year zero-coupon bond with a face value of $400 million. The yield to…

A: Modified Duration of Zero coupon Bond = (Macaulay duration of bond) /( 1+ Yield) Macaulay duration…

Q: What will be the bonds’ new prices if market yields change immediately by ± 0.10 percent?

A: The bond is selling at par. Thus, yield to maturity = coupon rate = 10.5% If market yield change by…

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: