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The following data apply to Neuman Corporation's convertible bonds: Maturity: 10 Par value: 1,000.00 Annual Coupon: 5.00% Stock Price: 30 Conversion price: 35 Straight-debt yield:

The following data apply to Neuman Corporation's convertible bonds:

Maturity: 10

Par value: 1,000.00

Annual Coupon: 5.00%

Stock Price: 30

Conversion price: 35

Straight-debt yield: 8%

a) What is the bond's conversion ratio?

b) What is the bond's conversion value?

c)What is the bond's straight-debt value?

d) Based on your answers to the three proceding questions, what is the minimum price (or "floor" price) at which the Neuman's bonds should sell?

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