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The TrunkLine Company bondholders provided $25. The firm promised to pay bondholders $35. If the firm does well (80% probability), the bondholders will be paid

The TrunkLine Company bondholders provided $25. The firm promised to pay bondholders $35. If the firm does well (80% probability), the bondholders will be paid promised $35, but if the firm does poorly (20% probability), there will be only $20 left to pay bondholders. The expected return to the bondholders is approximately:

A.

29.57%
B.

16.9%
C.

40.0%
D.

28.0%
E.

100%

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