Question
A $1000 par value convertible bond has a conversion price of $50. It is currently selling for $1,120 despite the fact that the bonds coupon
A $1000 par value convertible bond has a conversion price of $50. It is currently selling for $1,120 despite the fact that the bonds coupon rate and the market rate are equal. The common stock obtained upon conversion is selling for $54 per share. What is the convertible bonds conversion premium?
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Contemporary Financial Management
Authors: R. Charles Moyer, William J. Kretlow, James R. Mcguigan
8th Edition
0324065914, 9780324065916
