All of the Following Statements Regarding Convertible Bonds Are True

Multiple Choice

All of the following statements regarding convertible bonds are true except

A) if the market price of common stock increases substantially, bondholders with convertible bonds benefit.
B) convertible bonds can be converted into common stock at the option of the issuing company.
C) bondholders with convertible bonds receive interest on the bonds until conversion.
D) convertible bonds sell at a higher price and pay a low rate of interest than those without the conversion option.