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explain the term- maturitiesdebentures are sometimes grouped by length of time till maturity that existed on the date debenture was first issued
explain about the interest paymentsdebenture interest is generally paid semi-annually however annual payments arent uncommon usually there are
what is coupon ratecoupon rate is the stipulated interest rate to be paid on the face value of a bond it represents a fixed dollar amount which
what is face value par valuevalue of security as mentioned on certificate of the security face values and par values are two terms that are used
how debt securities is different from term loandebt securities are different from term loans provided by financial institutions and banks to the
what are the factors of debt securitiesa legal agreement known as a trust deed is drawn between security holders and company issuing the debt
valuing debt securitiessecurities which promise to pay its investors a stated rate of interest and return principal amount at the maturity date are
how can we measure total return- measuring the rate of returntotal return can be defined astotal returns cash payment received price change over
determine the concept of measuring the rate of returnthe rate of return is total return the investor receives during holding period the period when
what are the components of returnreturn is fundamentally made up of two componentsperiodic cash receipts or income on the investment in the form
what is the value of the security to an investor value of the security to an investor is directly proportional to the return that he is expected to
factors of importance of returns in any investment importance of returns in any investment decision can be traced to the following factorsit
explain about the valuing securitiesobjective of any investor is to maximise expected returns from his investments subject to various constraints
what is meaning of perpetuityif annuity is expected to go on forever then it is known as a perpetuity and then the above formula reduces topresent
enumerate the present value of an annuitypresent value of an annuity can be calculated bypresent value a 1i n -1 i 1i nor to use the tables change
state the example to calculate the present value2 00000 is the amount which you require after 20 years for your retirement how much must you invest
how can we measure the present valuewhen we solve for present value rather than compounding the cash flows to the future we discount future cash
how compound values can be calculated on anannual basiscompound values can be calculated on anannual basis or on a half-yearly basis or on a monthly
procedure of measurement of future valueif we are getting a return of 10 in one year then what is the return we are going to get in two years 20
ho can we estimate that firm is going to benefit from projecto calculate how firm is going to benefit from project we need to calculate whether firm
explain about opportunity cost of capitalrisk free rate compensates for opportunity lost and risk premium compensates for risk it can also be known
what is risk free rate of returnthere is a risk free rate of return also known as time preference rate which is used to compensate for the loss of
determine the term- time value of moneyif an individual behaves rationally then he wouldnt equate money in hand today with same value a year from now
what is performance appraisal - cost of capitalperformance appraisal further cost of capital framework can be used to evaluate financial performance
explain about the debt policydesigning debt policy the debt policy of a firm is significantly influenced by the cost consideration in designing