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The coupon value is usually 1/000 of a cent. They can also be 1/20 or 1/1000 of a cent. The face value is how much the coupon takes off your bill.

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12y ago

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What is the face value of the coupon you are referring to?

The face value of a coupon is the amount of money it is worth before any discounts or promotions are applied.


What is coupon rate?

Coupon rate is simply just the annual coupon payments paid by the issuer relative to the bond's face or par value.Coupon rate can be calculated by dividing the sum of the security's annual coupon payments and dividing them by the bond's par value. For example, a bond which was issued with a face value of $1000 that pays a $25 coupon semi-annually would have a coupon rate of 5%.Source: investopedia


What is a zero-coupon note?

A zero-coupon note is a note which pays at maturity the value of the note with no separate interest payments.


A bond 5 years to maturity and a coupon rate of 6 percent has a face value of 20000 Interest is paid annually If you required a return of 8 percent on this bond what is the value of this bond?

To find the value of the bond, we need to calculate the present value of its future cash flows, which include annual coupon payments and the face value at maturity. The annual coupon payment is 6% of the face value, which is $1,200. Using a discount rate of 8%, the present value of the coupon payments and the face value can be calculated as follows: [ PV = \frac{1,200}{(1 + 0.08)^1} + \frac{1,200}{(1 + 0.08)^2} + \frac{1,200}{(1 + 0.08)^3} + \frac{1,200}{(1 + 0.08)^4} + \frac{1,200 + 20,000}{(1 + 0.08)^5} ] Calculating this gives a bond value of approximately $17,490.66.


If the inflation premium for a bond goes up the price of the bond?

The price of the bond decreases; the inflation premium would increase the market interest rate, which in bond valuation is located in the denominator, and the coupon payment rate is located in the numerator. When calculating the NPV of future coupon payments, as the denominator or market interest rate + inflation premium increases, the Net Present Value of future coupon payments decreases and the overall value of the bond decreases as well. The price of the bond decreases; the inflation premium would increase the market interest rate, which in bond valuation is located in the denominator, and the coupon payment rate is located in the numerator. When calculating the NPV of future coupon payments, as the denominator or market interest rate + inflation premium increases, the Net Present Value of future coupon payments decreases and the overall value of the bond decreases as well.

Related Questions

What is the face value of the coupon you are referring to?

The face value of a coupon is the amount of money it is worth before any discounts or promotions are applied.


Are the Entertainment coupon books a good value?

It depends on how much you use the services provided in the coupon book. They are a great value if you use the services.


I need to print a coupon for tonight 19 buy one and get free of equal value Can you help me to get ?

I need to print a coupon for tonight 19 buy one and get free of equal value Can you help me to get this coupon?


PV of 31 year zero coupon bond with a YTM of 8 par Value 1000?

present value zero coupon=1000/(1.08)31


What is coupon rate?

Coupon rate is simply just the annual coupon payments paid by the issuer relative to the bond's face or par value.Coupon rate can be calculated by dividing the sum of the security's annual coupon payments and dividing them by the bond's par value. For example, a bond which was issued with a face value of $1000 that pays a $25 coupon semi-annually would have a coupon rate of 5%.Source: investopedia


What is a double coupon?

it is a coupon that has double The value of the coupon will be doubled. I found that most of my local store will only double up to $1.00. So if the value was $0.75 they would only give you credit up to $1.00 not $1.50. I hope this helps, Rachel


What is a zero-coupon note?

A zero-coupon note is a note which pays at maturity the value of the note with no separate interest payments.


What is the current price of a municipal bond with a coupon rate of 6.75 that is trading at par value?

The current price of a municipal bond with a coupon rate of 6.75 that is trading at par value is 1,000.


How do bondholders get a return on zero coupon bonds?

Zero coupon bonds do not pay interest and are therefore sold at a steep discount to face value depending on the maturity date of the bond. Due to the time value of money, the discount on a 30 year zero coupon bond will be much greater than on a 10 year zero coupon bond. At maturity bondholders will receive the full face value of the bond which provides bondholders a return. For example, a 30 year zero coupon bond with a face value of $1,000 and sold for $500 would return a $500 profit after 30 years. Holders of zero coupon bonds can sell the bonds at any time before maturity. If an investor bought zero coupon bonds prior to a steep drop in interest rates, the value of the zero coupon bonds would increase and could be sold at a profit.


How much are computer coupons worth?

You will have to look at the coupon. If there is a dollar amount off on the coupon, then that is what is worth. If it a a percentage off, then the value is determined.


Is zero coupon bond more sensitive to change in interest rate than fixed coupon bond?

The zero coupon bond is more sensitive to change in rate (inflation) because the market value is not based on a fixed coupon.


How is Modified Duration calculated for a Zero Coupon Bond?

3 years zero coupon bond. face value $100 and present market value $75. What will be its Macualay Duration and Modified Duration?