Use the following information for the next four problems. Plunkett Gym Equipment, Inc., has a $1,000 convertible bond outstanding that can be converted into 25 shares of common stock. The common stock is currently selling for $34.75 a share, and the convertible bond is selling for $960. The bond has 20 years to maturity. The bond has a coupon rate of 8% and interest rates in the market for bonds of comparable quality are 9%.

1. What is the conversion ratio of the bond?

2. What is the pure bond value?