York Oil has a bond issue outstanding with seven years to maturity, a yield to maturity of 9.0%, and a BBB rating. The bondholders' expected loss rate in the event of default is 60%. BBB bonds have a default rate of 4% and a market beta of 0.2.  The expected return on Wyatt Oil's debt is closest 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: