RWJ 7th Edition Solutions

The minimum value for this bond is the convertible floor value of $950.00. b. The option embedded in the bond adds the extra value. 11. a. The minimum bond price is the greater of the straight bond value or the conversion value. The straight bond value is: Straight bond value = $70(PVIFA9%,30) + $1,000/1.0930 . Straight bond value = $794.53 ................
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