Better Beta Inc. has a convertible bond issue currently selling in the market for $840. Each bond is exchangeable for 50 shares of Better Beta common stock.

The convertible bond has an 8 percent coupon. Similar non-convertible bonds are priced to yield 12 percent. The bond matures in eight years. Stock in Better Beta sells for $16 per share.

Required:

a) What is the conversion ratio, and the conversion price?

b) What is the minimum price that the bond will sell for? (SHOW ALL CALCULATIONS)