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.

Question

Quizplus · Accepted Answer

Since Investor A bought the bonds while Investor B did not, it can be assumed that Investor A has a lower required return for the bonds compared to Investor B. This is because Investor A is willing to pay the market price of $1,100 for the bonds, while Investor B is not. This means that Investor A is satisfied with the bond's yield, which is below Investor B's required return.

Both Investor a and Investor B Are Considering the Purchase