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Likelihood that a Troubled Firm Will Fail
  • Likelihood that a Troubled Firm Will Fail
Originally published: 12/07/2016 10:55
Publication number: ELQ-86518-1
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Likelihood that a Troubled Firm Will Fail

This model quantifies the probability of failure for troubled firms.

Prof. Aswath Damodaranby Prof. Aswath Damodaran
Professor at NYU Stern School of BusinessFollow 1,091
NYU Stern School of Businesswith NYU Stern School of Business
An Education in PossibleFollow 62
5 reviews320 views|Start the discussion!|Bookmark download for free
riskfinancetroubled firmfailureprobability
Description
The user must define the following inputs:
- Coupon Rate
- Maturity of bond
- Riskfree rate
- Market price of bond


Note: this model is being shared with the authorization of Professor Aswath Damodaran from NYU Stern Business School

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1 Excel Model

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Further information

Outputs:
- Probability of distress (Annual)
- Probability of distress over 5 years
- Probability of distress over 10 years


4.6 / 5 (5 votes)

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