Question
You have purchased a convertible bond for $1,133.12. It is convertible into 34 shares of the firm's common stock. The current stock price is $19.20
You have purchased a convertible bond for $1,133.12. It is convertible into 34 shares of the firm's common stock. The current stock price is $19.20 per share.
a. What is the market conversion value of the bond?
Market conversion value $
b. What is the conversion premium?
Conversion premium SC
c. Will you choose to convert the stock now?
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Financial Markets and Institutions
Authors: Anthony Saunders, Marcia Cornett
6th edition
9780077641849, 77861663, 77641841, 978-0077861667
