Caven Buffet Industries issues bonds with a 7% coupon rate and $1000 face value. Interest is...

Caven Buffet Industries issues bonds with a 7% coupon rate and $1000 face value. Interest is paid semi-anually and the bond has 18 years to maturity. However, the bond does not pay the first two coupon payments and instead makes these payments at maturity. If investors require a 15% return, What is the bond's value?

A) $1,161.81

B) $3,034.73

C) $698.80

D) $448.48

Can you please show the work?

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jeff jeffy answered 2 years ago

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