ABC corporation requires fund for its day-to-day operations, so the company issued bonds with face value of $7500 to generate fund for 5 years. The company pays interest on a monthly basis at a rate of 13% per year. The required rate of return on comparable bonds in the market is 12% per year. Based on the information, determine whether or not investors should purchase this bond, and why?

Answer rating: 100% (QA)

To determine whether investors should purchase this bond we need to calculate the present value of t... View the full answer