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A Firm Issues the Convertible Debt Shown Above

Question 57

Multiple Choice

A firm issues the convertible debt shown above. The price of stock in this company on July 1, 2008 is $6.00. What is the minimum call price that would make a bondholder prefer to accept the call rather than convert? A) par B) par plus 12% C) par plus 8% D) par plus 1.2% A firm issues the convertible debt shown above. The price of stock in this company on July 1, 2008 is $6.00. What is the minimum call price that would make a bondholder prefer to accept the call rather than convert?


A) par
B) par plus 12%
C) par plus 8%
D) par plus 1.2%

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