A convertible bond is often utilized
A) as a sweetener when selling debt.
B) to sell common at prices higher than those prevailing when funds are needed.
C) when there is no demand for straight debt.
D) All of these.

Question

Quizplus · Accepted Answer

A convertible bond serves multiple purposes, including acting as a sweetener when selling debt as investors are attracted to the potential equity conversion, allowing a company to sell common at prices higher than prevailing market prices, and providing an alternative financing option when there is no demand for straight debt. Therefore, Option D - All of these is the best choice.

A Convertible Bond Is Often Utilized