A firm issues the convertible debt shown above. The price of stock in this company on July 1, 2008 is $27.24. What is the minimum conversion ratio that would make a bondholder prefer to convert rather than accept the call price?
A) 33 shares per $1,000 principal amount
B) 36 shares per $1,000 principal amount
C) 38 shares per $1,000 principal amount
D) 42 shares per $1,000 principal amount
Correct Answer:
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