Bond Refunding New Business Ventures, Inc., has an outstanding perpetual bond with a 10 percent coupon rate that can be called in one year. The bonds make annual coupon payments.

The call premium is set at $150 over par value. There is a 40 percent chance that the interest rate in one year will be 12 percent, and a 60 percent chance that the interest rate will be 7 percent.

If the current interest rate is 10 percent, what is the current market price of the bond? LO.1