The value of a bond is given by
A) bond value = asset value - value of call option on assets.
B) bond value = asset value - value of call option on assets and bond value = value of an equivalent default-free bond + value of put option on assets.
C) bond value = value of an equivalent default-free bond + value of put option on the stock and bond value = asset value + value of call option on the stock.
D) bond value = asset value + value of call option on the stock.
Correct Answer:
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