Multiple Choice
A convertible bond has a face value of $1,000 and a conversion price of $35. The bond has a 9 percent coupon and pays interest semi-annually. The bond matures in 7 years. Similar bonds are yielding 8.5 percent. The current price of the stock is $36.30. What is the conversion value of this bond?
A) $989.16
B) $1,000.00
C) $1,025.98
D) $1,037.14
E) $1,041.07
Correct Answer:
Verified
Correct Answer:
Verified
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