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Calculate the conversion premium for bond

A convertible bond has the following features:

Coupon	5.25%
Maturity	June 15, 2027
Market price of bond	$77.50
Market price of underlying common stock	$28.00
Annual dividend	$1.20
Conversion ratio	20.83 shares

Calculate the conversion premium for this bond.

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Finance Basics: Calculate the conversion premium for bond

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Calculate the conversion premium for bond

Reference No:- TGS0680396

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Calculate the conversion premium for bond

Reference No:- TGS0680396

Recent Questions Asked Finance Basics

Q : Practice by an astute president

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Q : Record the repayment of the loan principal

Q : What is the interest expense

Q : Calculate the conversion premium for bond

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Q : Calculate the annual-end-of-year loan payment

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