Multiple Choice
A convertible bond has a face value of $1,000 and a conversion ratio of 50. This bond will sell at a premium when which of the following occurs?
A) when market rates fall below the bond's coupon rate
B) when the firm's stock sells for more than $20 per share
C) when market rates rise above the bond's coupon rate
D) A and B
Correct Answer:
Verified
Correct Answer:
Verified
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