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The IKC Corporation has convertible bonds outstanding. The bonds have a coupon rate of 8 percent and a conversion ratio of 5 0 shares to
The IKC Corporation has convertible bonds outstanding. The bonds have a coupon rate of percent and a conversion ratio of shares to one bond. They mature in years and pay semiannual coupons. If similar straight debt has a nominal return of percent, what price will investors pay for the conversion privilege if the bonds currently are selling at par?
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