Use the following information for questions 12 - 18. Consider the following convertible bond issue from Twitter in 2014. Issuer: Twitter, Inc. Issue Date: 15 September 2014 Maturity Date: 15 September 2021 Interest: 1% payable semi-annually, 15 March and 15 September Issue Size: $1,000,000,000 Issue Price: $1,000 Conversion Ratio: 12.8793 Share Price, 15 September 2014: $51.60 12. What is the conversion price for Twitter's convertible bond? 13. What is the current conversion premium for this bond? 14. Suppose that, exactly 3 years later (15 September 2017), Twitter's stock price is still $51.60 and the yield to maturity on comparable Twitter nonconvertible bonds is 4%. What is the lowest possible value for this convertible bond? Explain your answer in 1-2 sentences. 15. Suppose that, exactly 4 years later (15 September 2018), Twitter's stock price is now $90 and the yield to maturity on comparable Twitter nonconvertible bonds is 4%. What is the lowest possible value for this convertible bond? Explain your answer in 1-2 sentences. 16. Suppose that, on 15 September 2019, the price of this convertible bond was $1,400 and Twitter's stock price was $100. What is the market conversion premium per share for this bond? 17. Consider your answer in #16 as the basis for this problem. Suppose that Twitter's stock price volatility on 15 September 2019 was 15% but that recent legislation is being developed that would regulate social media platforms. The market is unsure of how this legislation will impact social media firms like Twitter so this represents an additional source of risk/volatility (so volatility will increase). What do you expect will happen to the convertible bond's price and the market conversion premium relative to the numbers in Problem 16 (increase/decreaseothing). Explain your answer in 1-2 sentences. 18. Twitter issued two convertible bonds on 15 September 2014. The first one is the one described above while the second bond was virtually identical but matures two years earlier (15 September 2019). All else equal, which bond would you expect to have a higher price and conversion premium? Explain your answer in 1-2 sentences. Use the following information for questions 12 - 18. Consider the following convertible bond issue from Twitter in 2014. Issuer: Twitter, Inc. Issue Date: 15 September 2014 Maturity Date: 15 September 2021 Interest: 1% payable semi-annually, 15 March and 15 September Issue Size: $1,000,000,000 Issue Price: $1,000 Conversion Ratio: 12.8793 Share Price, 15 September 2014: $51.60 12. What is the conversion price for Twitter's convertible bond? 13. What is the current conversion premium for this bond? 14. Suppose that, exactly 3 years later (15 September 2017), Twitter's stock price is still $51.60 and the yield to maturity on comparable Twitter nonconvertible bonds is 4%. What is the lowest possible value for this convertible bond? Explain your answer in 1-2 sentences. 15. Suppose that, exactly 4 years later (15 September 2018), Twitter's stock price is now $90 and the yield to maturity on comparable Twitter nonconvertible bonds is 4%. What is the lowest possible value for this convertible bond? Explain your answer in 1-2 sentences. 16. Suppose that, on 15 September 2019, the price of this convertible bond was $1,400 and Twitter's stock price was $100. What is the market conversion premium per share for this bond? 17. Consider your answer in #16 as the basis for this problem. Suppose that Twitter's stock price volatility on 15 September 2019 was 15% but that recent legislation is being developed that would regulate social media platforms. The market is unsure of how this legislation will impact social media firms like Twitter so this represents an additional source of risk/volatility (so volatility will increase). What do you expect will happen to the convertible bond's price and the market conversion premium relative to the numbers in Problem 16 (increase/decreaseothing). Explain your answer in 1-2 sentences. 18. Twitter issued two convertible bonds on 15 September 2014. The first one is the one described above while the second bond was virtually identical but matures two years earlier (15 September 2019). All else equal, which bond would you expect to have a higher price and conversion premium? Explain your answer in 1-2 sentences