Diamond Drill Inc.has 150,000 shares and 15,000 warrants outstanding.A warrant holder can purchase a new share of equity for five warrants and €5.00 per warrant.The equity is currently selling for €27 per share.The holder of a €1,000 face value bond can exchange the bond any time for 25 shares of equity.The conversion price is:

Question

Quizplus · Accepted Answer

To calculate the conversion price, we need to divide the face value of the bond (€1,000) by the number of shares it can be converted into (25):

Conversion price = €1,000 ÷ 25 = €40

Therefore, the correct choice is B as it represents the conversion price of the bond. The other options are not relevant to the given information.