How much money can they raise today per bond

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Question - Tesla will soon need to raise capital. However, Elon Musk is always interested in doing things differently. He does not want to offer a standard corporate bond. After doing a radio interview he decides to issue the following bond: It will have a standard face value of $1000 but every 4 months will pay a coupon payment equal to 20% of the face value. The bond will mature in 140 years. Assume an annual effective discount rate of 8%. How much money can they raise today per bond?

Reference no: EM132714744

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