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Which of the Following Statements About Convertible Securities Is True

Question 53

Multiple Choice

Which of the following statements about convertible securities is true?


A) They provide a guaranteed income stream, minimum value, and conversion
B) The conversion premium is influenced by the volatility of the underlying common stock, term to maturity, and dividend payment relative to interest rate
C) They are potentially dilutive to earnings and must be taken into consideration in the calculation of both primary and fully diluted earnings per share
D) All of the above are true

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