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Find the floor value of the convertible bond is

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NIT Ltd issued convertible bonds with a face value of $1,000 and a conversion ratio of 20 shares. The price of the convertible bond is $920. The current market price of an otherwise identical plain bond is $890 and the share price of NIT is $40.

Question 1: The floor value of the convertible bond is:

Select one:

a. $1000

b. $0

c. $800

d. $890

e. $930

Reference no: EM132505397

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