Question
7. You buy a convertible bond for $1000 and it has a conversion ratio of 50. Six years later, the stock of the firm is
7. You buy a convertible bond for $1000 and it has a conversion ratio of 50. Six years later, the stock of the firm is selling for $35 per share. If you were to convert your bond into stock and sell those shares in the stock market for $35 per share, what would be your profit on your investment in convertible bonds?
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Principles Of Managerial Finance
Authors: Lawrence J. Gitman, Chad J. Zutter
13th Edition
9780132738729, 136119468, 132738724, 978-0136119463
