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A Firm Issues the Convertible Debt Shown Above

Question 88

Multiple Choice

A firm issues the convertible debt shown above.The price of stock in this company on July 1,2008 is $36.00.What is the minimum call price that would make a bondholder prefer to accept the call rather than convert? A) par B) par plus 2.6% C) par plus 3.0% D) par plus 3.4% E) par plus 4.1% A firm issues the convertible debt shown above.The price of stock in this company on July 1,2008 is $36.00.What is the minimum call price that would make a bondholder prefer to accept the call rather than convert?


A) par
B) par plus 2.6%
C) par plus 3.0%
D) par plus 3.4%
E) par plus 4.1%

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