ABC owns a convertible bond that matures in four years. The bond has an 8 percent...
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ABC owns a convertible bond that matures in four years. The bond has an 8 percent coupon and pays interest annually. The face value of the bond is $1,000 and the conversion price is $20.65. Similar bonds have a market return of 6 percent. The current price of the stock is $21.82. What is the floor price of this bond? ABC owns a convertible bond that matures in four years. The bond has an 8 percent coupon and pays interest annually. The face value of the bond is $1,000 and the conversion price is $20.65. Similar bonds have a market return of 6 percent. The current price of the stock is $21.82. What is the floor price of this bond?
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Answer rating: 100% (QA)
Answer Conversion ratio Par value Conversion price Conversion ratio 1000 206... View the full answer
Related Book For
Introduction To Corporate Finance
ISBN: 9781118300763
3rd Edition
Authors: Laurence Booth, Sean Cleary
Posted Date:
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