Orient airlines common stock currently sells for 33 and its


Orient Airlines' common stock currently sells for $33, and its eight percent convertible debentures (issued at par, or $1,000) sell for $850. Each debenture can be converted into 25 shares of common stock at any time before 2019. What is the conversion value of the bond?

(a) $707.33
(b) $744.56
(c) $783.75
(d) $825.00
(e) $866.25

 

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Finance Basics: Orient airlines common stock currently sells for 33 and its
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