A certain 6

6% annual coupon rate convertible bond(maturing in 20years) is convertible at theholder's option into 20

20 shares of common stock. The bond is currently trading at $800

800. The stock(which pays 83

83 a share in annualdividends) is currently priced in the market at $35.36

35.36 a share.

a. What is thebond's conversionprice?

b. What is its conversionratio?

c. What is the conversion value of thisissue? What is its conversionparity?

d. What is the conversionpremium, in dollars and as apercentage?

e. What is thebond's paybackperiod?

f. If comparablyrated, nonconvertible bonds sell to yield 8 % comma

8%, what is the investment value of theconvertible?

a. Thebond's conversion price is $

50

50. (Round to the nearestcent.)

b. The conversion ratio is

nothing

shares.(Round to the nearestinteger.)

c. The conversion value of this issue is $

nothing

. (Round to the nearestcent.)

The conversion parity of this issue is $

nothing

. (Round to the nearestcent.)

d.The conversion premium in dollars is $

nothing

. (Round to the nearestcent.)

The conversion premium as a percentage is

nothing

%. (Round to two decimalplaces.)

e. Thebond's payback period is

nothing

years.(Round to one decimalplace.)

f. The investment value of the convertible is $

nothing

. (Round to the nearestcent.)