Market rates are 10 annually i what is the conversion ratio


A convertible bond has a face value of $1,000 and the conversion price is $40 per share. The stock is selling at $30 per share. The bond pays $65 per year in interest and is selling in the market for $950. It matures in 7 years. Market rates are 10% annually. (I) What is the conversion ratio? (II) What is the conversion value?

Request for Solution File

Ask an Expert for Answer!!
Financial Management: Market rates are 10 annually i what is the conversion ratio
Reference No:- TGS02668142

Expected delivery within 24 Hours