Answers A 1 Liquidity risk factor 2 Company defaulting Risk- may become default in future 3 company fundamental might change due to change in the country futu B AA-BBB-B-DEFAULT 0.00350% AA-BBB-BB 0.00200% AA-A-BB 0.00090% 0.00640% CONCLUSI C 2 YR GOVT BOND YIELD 3% BBB RATED BPS 90 TOTAL BOND YIELD 3.90% COUPN PAYMENT 2.30% BOND PRICE WILL BE 96.9779189 ROI -0.7200% D ROI 0.0045906 TOTAL PROBABILITY OF DEFAULT DEFAULT IN FIRST 3 YEARS BECAUSE THE MAXIMUM PROBABILITY OF BEING DEFAULT IS VERY VERY LESS
Sheet1AnswersA1Liquidity risk factor2Company defaulting Risk-
may become default in future3company fundamental might change due
to change in the country future prespective
BAA-BBB-B-DEFAULT0.00350%AA-BBB-BB0.00200%AA-A-BB0.00090%TOTAL
PROBABILITY OF DEFAULT0.00640%CONCLUSIONTHE COMPANY CANNOT GO
DEFAULT IN FIRST 3 YEARS BECAUSE THE MAXIMUM PROBABILITY OF BEING
DEFAULT IS VERY VERY LESSC2 YR GOVT BOND YIELD3%BBB RATED
BPS90TOTAL BOND YIELD3.90%COUPN PAYMENT2.30%BOND PRICE WILL
BE96.9779189103ROI-0.7200%DROI0.0045906
