2. At the birth of twin grandchildren, the grandparents gave the parents $10,000 to buy bonds for the newborns as a start to their college savings. (LO 14-1–LO 14-4)

a. What bonds would you recommend be bought and why?

b. What options are there to diversify this bond investment?

c. In this example, if $5,000 had been invested in a corporate convertible bond at year 5 and the company’s stock price has been trending well, what would be the motivators (if any) for converting the bond to stock?