Question
Assume that Chen Inc. has issued a BB-rated convertible bond with an annual coupon of 4%, a par value of $1000 and 12 years to
Assume that Chen Inc. has issued a BB-rated convertible bond with an annual coupon of 4%, a par value of $1000 and 12 years to maturity. Nonconvertible BB-rated bonds of this maturity have a yield of 6%. The bond has a conversion ratio of 20 and the firms shares are currently trading at $41.5.
What is the conversion price of the Chen bond?
| $1000 | ||
| $830 | ||
| $840 | ||
| None of the above |
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Cryptocurrency And Public Policy
Authors: Donavon Johnson
1st Edition
1032311231, 978-1032311234
