1) The value of Bond #9 is equal to the value of Bond #10:

minus the value of a call option on Whortons common stock.

plus the value of a call option on Whortons common stock.

plus the value of a put option on Whortons common stock

2) The minimum value of Bond #9 is equal to the greater of:

A. the current value of Bond #10 and a call option on Whortons common stock.

B. the conversion value of Bond #9 and the current value of Bond #10.

C. the conversion value of Bond #9 and a call option on Whortons common stock.

3) The factor that is currently least likely to affect the risk- return characteristics of Bond #9 is:

A. A Interest rate movements.

B. Whortons common stock price movements

C. Whortons credit spreads.

Last, you select the two bonds issued by Whorton, Inc. given in Exhibit 7 . These bonds are close to their maturity date and are identical, except that Bond \#9 includes a conversion option Whorton's common stock is currently trading at $30 per share. Last, you select the two bonds issued by Whorton, Inc. given in Exhibit 7 . These bonds are close to their maturity date and are identical, except that Bond \#9 includes a conversion option Whorton's common stock is currently trading at $30 per share