9) MrC Corp has a bond issue outstanding that pays $70 every year for the next 4 years. It has a face value (par value) of $1,000 and will mature in four years.

Assume: real risk-free rate = 3%, inflation premium = 2%, Maturity risk premium = 1%, Default risk premium = 4%, and liquidity premium = 2%. Given these conditions, what is the value ( or price) of the bond?

a. $848

b. $905

c. $925

d. $769

e. $729

Note: Im not sure how to solve given the assumptions. Could I have an explanation if possible?