Compute the bond conversion value and conversion price

Assignment Help Financial Management

Reference no: EM131064767

Steven Long, a bond analyst, is analyzing a convertible bond. The characteristics of the bond are given below. Convertible Bond Characteristics Par value $ 1,000 Annual coupon rate (annual pay) 7.5 % Conversion ratio 24 Market price 117 % of par Straight value 99 % of par Underlying Stock Characteristics Current market price $ 36 per share Compute the bond’s conversion value and conversion price. (Round your conversion price to 2 decimal places. Omit the "$" sign in your response.)

Reference no: EM131064767

Questions Cloud

Two-asset portfolio including stock and risk free security : A friend says she expects to earn 13.50% on her portfolio with a beta of 1.50. You have a two-asset portfolio including stock x and a risk free security. The expected return of stock x is 10.50 and the beta is 1.10. The expected return on the risk fr..

Reaction consistent with strong form of market efficiency : Find an announcement of new information made within a month from today (i.e., earnings announcement, merger, etc.) for any publicly traded stock that moves the stock price at least 1%. Print out or draw a chart that shows at least 2 days before the e..

Discount rate for making minority investment in this firm : An investor is interested in making a minority equity investment in a small privately held firm. Because of the nature of the business, she concludes that it would be difficult to sell her interest in the business quickly. what should be the discount..

Figures into their constituent parts and stacking the graphs : By breaking down the figures into their constituent parts and stacking the graphs you can see how things have changed over time and, in this example, how they might change in the future both in overall figures and the numbers in each group.

Compute the bond conversion value and conversion price : Steven Long, a bond analyst, is analyzing a convertible bond. The characteristics of the bond are given below. Convertible Bond Characteristics Par value $ 1,000 Annual coupon rate (annual pay) 7.5 % Conversion ratio 24 Market price 117 % of par Stra..

Prove that mod a =mod b or mod a= mod 2b : You searched"the resultant of 2 vectors vector a and vector b acting at a point is equal to root 3 b and makes angle 30 with the direction of a

Explain how two world wars reduced the global economic clout : Explain how two world wars, the Cold War, and the Computer Revolution reduced the global economic clout of the Western European Atlantic powers and the U.S.

What was the flotation cost as percentage of funds raised : The Collins Co. has just gone public. Under a firm commitment agreement, Collins received $32.70 for each of the 4.17 million shares sold. The initial offering price was $35.10 per share, and the stock rose to $42.40 per share in the first few minute..

Provides a visual display of in this instance : As a variant of the histogram, the 'tree map' provides a visual display of, in this instance, the UK finances. Like a histogram, the area of each box is proportional to the amounts spent or received. This version of a tree map represents UK Govern..

User Account

All Pages