A convertible bond is valued at $1,062, has a conversion ratio of 25, and an option premium

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A convertible bond is valued at $1,062, has a conversion ratio of 25, and an option premium of $3. What is the conversion value if the straight bond value is equal to the bond's par value?

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Corporate Finance

ISBN: 978-0077861759

10th edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe

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Posted Date: May 08, 2023 08:56 AM

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A convertible bond is valued at $1,062, has a conversion ratio of 25, and an option premium

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To find the conversion value we need to multiply the conversion ratio by the ... View the full answer

Corporate Finance

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