Calculate the conversion price formula (CPF) and market price formula (MPF) prices for an offering involving an existing conversion with a price of $1, a hypothesized market price of $2, and a new offering price of $0.95 for 1,000 shares with 2,000 shares outstanding before the new issue. Relate the new conversion price to the implied new conversion ratio.

Show how your answers for the above would change if the new offering price was $0.80 for 1,500 shares. Assume other things remain the same.

What is the new:

a) CPF?

B) MPF?