Use the Following Information for Questions

Multiple Choice

Use the following information for questions
A bank has an obligation of $750 at the end of the first period and $550 at the end of the second period.It also has $1,528.93 to invest and can choose between zero-coupon bond or the coupon bond.The coupon bond matures in two years, pays an annual coupon of $100, and has a balloon payment of $1,400.The zero-coupon bond has a balloon payment of $1,610 at the end of the second year.The default-free yield on a one-year bond is 10%, and the annualized yield on a two-year bond is also 10%.
-What is the present value of the bank's equity?

A) $1,528.93
B) $1,500.00
C) $1,300.00
D) $1,136.36
E) $392.57