A $ 1 , 0 0 0 face amount 8 % convertible bond has a conversion ratio

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Question:

A $

1, 000

face amount

8 %

convertible bond has a conversion ratio of

20 .

The firm

s common stock is currently selling at $

40 .

If the bond is about to mature, what is its value?

Posted Date: May 11, 2024 04:16 AM

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A $ 1 , 0 0 0 face amount 8 % convertible bond has a conversion ratio

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Expert Answer:

To find the value of the convertible bond we need to consider two scenarios 1 If the bondho... View the full answer

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