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A large corporation in the shoe industry wants to issue $1,000, five-year convertible bonds. If the current market interest rate for similar non-convertible bonds is

A large corporation in the shoe industry wants to issue $1,000, five-year convertible bonds. If the current market interest rate for similar non-convertible bonds is 7.8%, which of the following might be the most reasonable annual interest rate for the corporation to select for their bonds? WHY?

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