Rolling Railroad's common stock is currently priced at $40, and its 8 percent convertible debentures (issued at

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Rolling Railroad's common stock is currently priced at $40, and its 8 percent convertible debentures (issued at par, or $1,000) are priced at $850. Each debenture can be converted into 25 shares of common stock at any time before 2005. What is the conversion price, CP, and the conversion value of the bond?
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Principles of Finance

ISBN: 978-1285429649

6th edition

Authors: Scott Besley, Eugene F. Brigham

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