John Peterson purchased a bond at a price far below its face value; it that makes no interest payments and will be redeemed at its face value at maturity. In all likelihood, he purchased a zero.coupon bond. Option A is correct.
A zero-coupon bond is a debt security that doesn't pay interest (a coupon) but is traded at a deep discount, rendering profit at maturity when the bond is redeemed for its full face value.
