What is the conversion value of the bond?
A) 25
B) 625
C) 40
D) 1000

Name: What is the conversion value of the bond? A) 25 B) 625 C) 40 D) 1000
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Question

Quizplus · Accepted Answer

The conversion value of a bond is calculated by multiplying the conversion ratio by the market value of the stock. Here, the conversion ratio is given as 25 and the market value of the stock is $25 per share.

Therefore, the conversion value of the bond = 25 x 25 = $625.

Hence, option B is the correct answer.

What Is the Conversion Value of the Bond