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What is the value of the bond in terms of stock

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Reference no: EM132705258

You know the following information with regard to a convertible bond: Coupon 6%, exercise price $25, Maturity of 20 years, call price of $1,040, and the price of the common stock is $30.

-If this bond were not convertible, what would it be worth if comparable rates were 12%?

-Into how many shares can the bond be converted?

-What is the value of the bond in terms of stock?

-What is the current minimum price that the bond will command?

-If the current market price of the bond is $976, what should you do?

Reference no: EM132705258

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