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2. Orient Airlines' common stock currently sells for $31, and its 10-year maturity convertible bond with 8.5% coupon rate paid semi-annually has a yield to

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2. Orient Airlines' common stock currently sells for $31, and its 10-year maturity convertible bond with 8.5% coupon rate paid semi-annually has a yield to maturity of 12%. Each bond can be converted into 25 shares of common stock at any time before five years from now. Assuming its stock price is expected to grow at 2% every year, show with calculations whether bondholders of this convertible bond more likely to convert the bond into common stock today? Show your calculations to support your answers to eam full points ( 5 points)

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