Promised Yield on the Bond Calculation
Not what you're looking for?
Consider a one-year, $1000, zero-coupon bond issued. Assume that the bond payoffs are uncertain. There is a 50% chance that the bond will repay its face value in full and a 50% chance that the bond will default and you will receive $900. Thus, you would expect to receive $950. Because of the uncertainty, the discount rate is 5.9%. Calculate the promised yield on the bond.
Purchase this Solution
Solution Summary
This solution shows how to calculate the promised yield on a bond.
Purchase this Solution
Free BrainMass Quizzes
Basics of corporate finance
These questions will test you on your knowledge of finance.
Introduction to Finance
This quiz test introductory finance topics.
Academic Reading and Writing: Critical Thinking
Importance of Critical Thinking
Managing the Older Worker
This quiz will let you know some of the basics of dealing with older workers. This is increasingly important for managers and human resource workers as many countries are facing an increase in older people in the workforce
Paradigms and Frameworks of Management Research
This quiz evaluates your understanding of the paradigm-based and epistimological frameworks of research. It is intended for advanced students.