We are here with you hands in hands to facilitate your learning & don't appreciate the idea of copying or replicating solutions. Read More>>
+ Link For Assignments, GDBs & Online Quizzes Solution
+ Link For Past Papers, Solved MCQs, Short Notes & More
Dear Students! Share your Assignments / GDBs / Quizzes files as you receive in your LMS, So it can be discussed/solved timely. Add Discussion
How to Add New Discussion in Study Group ? Step By Step Guide Click Here.
FIN622 - Corporate Finance GDB No. 1 Solution Fall 2017 Due Date: Nov 13, 2017
|Starting Date||Monday, November 06, 2017|
|Closing Date||Monday, November 13, 2017|
|Question Title||Graded Discussion Board|
After doing this activity, students will be able to understand the nature of relationship between bonds price and the factors affecting it.
Theoretical literature on bonds valuation concludes that “all other things being the same, the price of a bond is an increasing function of the frequency of coupon payments”. This is somehow true in a sense that effective annual yield is higher for interest rate compounded more than once (semi-annually, quarterly, monthly) in a year. This relationship can be understood in a way that greater the number of compounding, higher will be the total coupon payment on bonds and it will have positive effect on market price of bonds. But bonds prices are not only influenced by compounding periods in a year, there are other factors playing the role such as yield to maturity, time to maturity and coupon rate. In practice, although some bonds make coupon payments on annual basis while mostly pay on semi-annual basis. It is therefore pertinent to know how frequency of coupon payments influence bonds prices. In real world situation, bonds prices not necessarily increase with the number of times coupon payment is made within a year as suggested in theory.
Following data pertains to a 1-year corporate bond having face value of Rs.1000 offering coupon rate of 10% compounded annually and semi-annually to its bondholders selling at different prices in the bond market as given below:
Explain the relationship of bond’s market price with frequency of coupon payments by considering the factors influencing the direction (increase/decrease/no change) of relationship.
For acquiring the relevant knowledge watch the course video lectures, consult recommended books, and study additional material available online or in any other mode.
Note related to load shedding: Please be proactive
As you know that Pre Mid-Term semester activities have started and load shedding problem is also prevailing in our country. Keeping in view the fact, you all are advised to post your activities as early as possible without waiting for the due date. For your convenience; activity schedule has already been uploaded on VULMS for the current semester, therefore no excuse will be entertained after due date of assignments or GDBs.
.+ http://bit.ly/vucodes (Link for Assignments, GDBs & Online Quizzes Solution)
+ http://bit.ly/papersvu (Link for Past Papers, Solved MCQs, Short Notes & More)+ Click Here to Search (Looking For something at vustudents.ning.com?) + Click Here To Join (Our facebook study Group)
Please Discuss here about this GDB.Thanks
Our main purpose here discussion not just Solution
We are here with you hands in hands to facilitate your learning and do not appreciate the idea of copying or replicating solutions. Read More>>
For Important Helping Material related to this subject (Solved MCQs, Short Notes, Solved past Papers, E-Books, FAQ,Short Questions Answers & more). You must view all the featured Discussion in this subject group.
For how you can view all the Featured discussions click on the Back to Subject Name Discussions link below the title of this Discussion & then under featured Discussion corner click on the view all link.
Or visit this link
Please Click on the below link to see…
P.S: Please always try to add the discussion in proper format title like “CS101 Assignment / GDB No 01 Solution & Discussion Due Date: ___________”
Need fin622 solution please help
I Also need solution
Dear Students Don’t wait for solution post your problems here and discuss ... after discussion a perfect solution will come in a result. So, Start it now, replies here give your comments according to your knowledge and understandings....
there is an inverse relationship between bond price and frequency of coupon payment because of more compounding affects. But this relationship is depend on market interet rate as well as time to maturity