Both Investor a and Investor B Are Considering the Purchase

question 14

Multiple Choice

Both investor A and investor B are considering the purchase of Corporation FJR bonds.The bonds are selling at a price of $1,100 each.Investor A decides to buy the bonds and Investor B does not buy the bonds.

• A)Investor A must have a required return lower than the required return for Investor B.
• B)The yield to maturity for Investor A must be higher than the yield to maturity for Investor B.
• C)The yield to maturity for Investor A must be less than the yield to maturity for Investor B.
• D)The yield to maturity for this bond must be higher than the coupon rate.

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