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Business, 07.05.2020 05:59 ShiannBerry

Zappo Corporation just issued $1,000 face value bonds that will mature in 20 years and have a 7% coupon rate. Interest is paid semi-annually and the required rate of return is 9 percent for these bonds. The bonds have a 5 year call provision that will pay a call premium of $1,050 if they are called in. What is the price of the Zappo Corporation bond?

a. $815.98

b. $817.43

c. $826.35

d. $920.87

e. $953.07

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