What is the conversion ratio, Finance Basics

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What is the conversion ratio

A convertible bond has a face value of $1,000, and the conversion price is $50 per share. The stock is selling at $42 per share. The bond pays $60 per year interest and is selling in the market for $930. It matures in 15 years.

Market rates are 10 percent per year.

a. What is the conversion ratio?

b. What is the conversion value?

c. What is the conversion premium (in dollars and percent)?

d. What is the floor value or pure bond value?

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Finance Basics: What is the conversion ratio

Reference No:- TGS0550122

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

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Request for Solution File

Ask an Expert for Answer!!

Finance Basics: What is the conversion ratio

Reference No:- TGS0550122

Recent Questions Asked Finance Basics

Q : Which of the following is not included in his gross estate

Q : Describe client general rules for benefits by employer

Q : Find the logic behind the irr method

Q : Which technique involves the lowest adverse impact

Q : What is the conversion ratio

Q : What is the intrinsic value

Q : Will sterling have an overall net gain or loss

Q : Which would involve the smallest taxable gift

Q : Find value of bonds when required interest rate is given

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