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A Firm Issues the Convertible Debt Shown Above

Question 64

Multiple Choice

A firm issues the convertible debt shown above. The price of stock in this company on July 1, 2008 is $15.14. What is the minimum call price that would make a bondholder prefer to accept the call rather than convert? A) par plus 3.29% B) par plus 3.89% C) par plus 4.49% D) par plus 5.98%
A firm issues the convertible debt shown above. The price of stock in this company on July 1, 2008 is $15.14. What is the minimum call price that would make a bondholder prefer to accept the call rather than convert?


A) par plus 3.29%
B) par plus 3.89%
C) par plus 4.49%
D) par plus 5.98%

Correct Answer:

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