ABC Corp Needs $8,000,000 of Debt for a Quarter Share Fractional

question 20

Multiple Choice

ABC Corp. needs $8,000,000 of debt for a quarter share fractional ownership of a Gulfstream IV executive jet. If the company's investment banker has offered to raise the financing by way of a zero coupon (strip) bond with a yield to maturity in 15 years of 6%, what will ABC Corporation's total cash outflow be at maturity?

• A) $25.4 million
• B) $77.7 million
• C) $8.0 million
• D) $19.2 million
• E) $186.2 million

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