Define how the market determine the fair value of a bond, Financial Management

Assignment Help:

How does the market determine the fair value of a bond?

The bond’s fair value is the present value of the bond's coupon interest payments plus the present value of the face value payment at maturity, discounted at the required rate of return of market for the bond in question.

Related Discussions:- Define how the market determine the fair value of a bond

Leverage, evaluate the importance of leverage in a small scale companyestio...

evaluate the importance of leverage in a small scale companyestion..

Types of financial investments, Question: (a) Give the four main types...

Question: (a) Give the four main types of financial investments and state the risks and benets associated to each type. (b) (i) Let k(t; T; s) denotes the return at time t

Difference in effective annual rate or annual rate, Emily Jill Rogers is p...

Emily Jill Rogers is planning to buy a house but needs assistance as to how she will finance the purchase. She has supplied you with some information and asked you to help her wit

Cost of the share at end of current financial year, Example: - MM Foam Com...

Example: - MM Foam Company at present has 5000 outstanding shares selling at Rs. 100 each. The firm suppose to have a net earning of Rs. 50000 as well as contemplating a dividend

What is the rationale of the double-play strategy, Q. What is the rationale...

Q. What is the rationale of the double-play strategy? The hedge funds deploy a double-play strategy in order to engineer steep increases in interest rates and steep declines in

Explain the demand for bananas increases, Suppose the demand for bananas in...

Suppose the demand for bananas increases. Explain how the price of bananas adjusts after the increase in demand. If the demand for bananas rises, a shortage is made at the origin

Explain about death benefit, Q. Explain about Death Benefit? Death Bene...

Q. Explain about Death Benefit? Death Benefit - Amounts received under a life insurance contract and paid by reason of death of the insured. (Even though most death benefits ar

Forms of bank finance, Q. Forms of Bank Finance? A firm can draw funds ...

Q. Forms of Bank Finance? A firm can draw funds from a bank within the maximum credit limit sanctioned. It can draw funds in the following forms: 1) Overdraft 2) Cash Cre

Explain the concepts of planning the work, Explain the concepts of Planning...

Explain the concepts of Planning the work Determine scope and objective of the audit (to verify assets, to check adequacy of internal controls etc...). Ensuring appropr

Investor’s considerations -financial market, Investor's Considerations ...

Investor's Considerations As mentioned above, every investor before taking an investment decision, must consider the following aspects: Risk: The primary consideration for t

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages