How does 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 fair value of a bond is a present value of the bond's coupon interest payments plus the present value of the face value payment at maturity, discounted at the market's required rate of return for the bond in question.  This text is use to solve for the fair (present) value of a bond.

 

 

 


Related Discussions:- How does the market determine the fair value of a bond

Formation of board of amc and restrictions on directors, Formation of Board...

Formation of Board of AMC and Restrictions on Directors Having regard to the significant role of the Board of Directors of the AMC in rendering the company's operations efficie

Certified public accountant, Certified Public Accountant (CPA) - ACCOUNTANT...

Certified Public Accountant (CPA) - ACCOUNTANT who has satisfied education, experience and examination requirements of her or his jurisdiction essential to be certified as a public

How to select the source of the finance, Selecting the source of the financ...

Selecting the source of the finance: after prepare of the capital structure an appropriate source of the funds. Various sources of the finance may be raised include share capital

Unity of command, Unity of Command Unity of command is the principle in...

Unity of Command Unity of command is the principle in which each subordinate should be responsible to only one manager.

Show factors influencing participation, Q. Show Factors influencing partici...

Q. Show Factors influencing participation? Factors influencing participation: several research studies have shown that the intensity of participation depends on four factors.

Illustrate dividend valuation model, Q. Illustrate dividend valuation model...

Q. Illustrate dividend valuation model? The business is being acquired as a going concern and earnings valuations rather than asset valuations are recommended. Even these are b

Analysis of the capacity to pay, In addition to management quality, a...

In addition to management quality, an assessment of the financial capacity of a company should also include an evaluation of trends, regulatory environment, basic

Common-size analysis, Common-size Analysis • Prepare a Common-size Analy...

Common-size Analysis • Prepare a Common-size Analysis for the Balance Sheet and Income Statement • This should include about 12 accounts in the Balance Sheet and about 10 Inc

Yield curve strategies, Yield curve strategies take into account the ...

Yield curve strategies take into account the distribution of the maturities of the bonds of the portfolio in order to take advantage of the forecasted movements o

Seasonal variation in time series analysis, Seasonal Variation Under th...

Seasonal Variation Under this variation, we observe that the variable under consideration shows a similar pattern during certain months of the successive years. An example of s

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd