Response to the following problem:
Changeling, Inc. bonds have a par value of $1,000 each and are convertible into common stock at $35 per share. The bonds were issued at par value.
a. What is the stated conversion price?
b. What is the conversion ratio of these bonds?
c. If the common stock is trading for $30 a share, what is the conversion value of these bonds?
d. If the common stock is trading for $40 a share, what is the conversion value of these bonds?
e. If the bond is trading at 90, what is the market conversion price?