Bonhomme Co. issued $1,000 par value bonds with a 6% coupon rate, convertible into 25 share of Bonhomme common stock. When the bonds were issued the stock traded at $30 per share. Interest rates have risen since issuance. The stock is now at $45 per share and pays a $3.00 per share quarterly dividend. In the near future it is most likely that. Question 16 options:

The bondholders will voluntarily convert their bonds to stock.

Both the issuing company and the bondholders will wait for the bonds to reach their maturity date.

The issuing company will call the bonds and the bondholders will receive cash.

The issuing company will call the bonds and bondholders will convert them to common shares.