Question: The following year, Faversham Fish Farm (see Problem 3) flounders. Its stock price drops to $10 per share and the market price of the convertible

The following year, Faversham Fish Farm (see Problem 3) flounders. Its stock price drops to $10 per share and the market price of the convertible debentures to $440 per debenture. The straight bond value goes to $410. Determine the premium over conversion value and the premium over straight bond value. What can you say about the bond value floor?

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