User Account

All Pages

Identify the new stock price of ancus inc

Assignment Help Finance Basics
Reference no: EM132589775

Dorsini Sportswear issued a semiannual coupon convertible bond some years ago, with face value as $1,000, semiannual coupon as $33 and conversion ratio as 40 shares. The bond will mature 2 years later from today, which means bondholders could receive the coming 4 semiannual coupon payments. Each convertible bond is currently trading at $1,011.

Suppose the appropriate discount rate is 8%p.a. and the current stock price is $24 per share.

Required:

(i) Determine the option value of the semiannual coupon convertible bond.

(ii) Analyze what would happen to the price of the convertible bond if the stock volatility of Dorsini Sportswear increases.

(b) Ancus Inc., newly issued 750,000 units of warrants. The holder of each warrant has the right to purchase one share of common stock for an exercise price of $9.5. Ancus Inc., is an all-equity firm, has 10 million shares of common stock outstanding. The current stock price is $12.5, and each warrant is worth $3.5.

Required:

If all warrants holders decide to exercise today, identify the new stock price of Ancus Inc.

Reference no: EM132589775

Questions Cloud

Calculate the implicit gains or losses : Recently, your MNE in Malaysia has just bought fabrics from a U.S. company, with payment of $1 million due in 6 months.
Balance the accounts at the end of the month : Prepare books of original entry to record the transactions. Record the opening entries in the general journal. Balance the accounts at the end of the month.
Cloud-computing data services and broad-band access : Imagine that IBM has decided to diversify into the telecommunications business to provide online cloud-computing data services and broad-band access
Are formal standardized tests acceptable to use in preschool : Are Formal Standardized Tests acceptable to use in preschool? Do you think teachers are adequately prepared to use assessment data to make instructional.
Identify the new stock price of ancus inc : Dorsini Sportswear issued a semiannual coupon convertible bond some years ago, with face value as $1,000, semiannual coupon
Analyze the external environment of the furniture stores : Analyze the external environment of the Furniture Stores in U.S.A. based on the following two segments: Socio-Cultural and Global.
Present value of synergy of the proposed acquisition : Green Rice Smartphone Inc. plans to acquire CCA Technologies Inc. Assume that both firms have no debts outstanding.
Evaluate the current market value of the perpetual bond : If MKTV Mall adopts Wing's suggestion, evaluate the current market value of the perpetual bond given the probabilities of interest rate change.)
Compute grouse ending inventory using the fifo method : The invoice cost of goods on hand at the end of the year is $3 million. Compute Grouse's ending inventory using the FIFO method.

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd