A bond that is currently selling for $933.38 has a conversion price of $40.00. If the par value is $1,000, what is the conversion ratio?
61. A bond that is currently selling for $933.38 has a conversion price of $40.00. If the par value is $1,000, what is the conversion ratio?
A. 23
B. 24
C. 25
D. 26
E. 27
Answer
Conversion ratio = $1,000/$40.00 = 25
62. A bond has a par value of $1,000 and a market value of $833.40. The conversion price is $45.45. What is the conversion ratio?
A. 21
B. 22
C. 23
D. 24
E. 25
Answer
Conversion ratio = $1,000/$45.45 = 22
63. A bond has a conversion price of $47.62, a par value of $1,000, and a market price of $833.40. What is the conversion ratio?
A. 20
B. 21
C. 22
D. 23
E. 24
Answer
Conversion ratio = $1,000/$47.62 = 21
64. What is the conversion ratio of a $1,000 par value bond that is selling for $888.96 and has a conversion price of $58.82?
A. 15
B. 16
C. 17
D. 18
E. 19
65. A convertible bond has a par value of $1,000 and a market price of $1,116.76. If the conversion ratio is 19, what is the conversion price?
A. $43.48
B. $45.45
C. $47.62
D. $52.63
E. $55.56
66. A convertible bond has a par value of $1,000, a market value of $875, and a conversion ratio of 14. What is the conversion price?
A. $55.56
B. $58.82
C. $62.50
D. $66.67
E. $71.43
67. A bond is currently priced at $1,076.88 and has a par value of $1,000. If the conversion ratio is 25, what is the conversion price?
A. $35.71
B. $36.92
C. $38.46
D. $40.00
E. $41.67
68. A bond has a conversion ratio of 24 and a market price of $1,080. If the par value is $1,000, what is the conversion price?
A. $40.00
B. $41.67
C. $42.60
D. $43.20
E. $43.80
69. A bond has a conversion ratio of 22, a $1,000 par value, and a market price of $1,038. The stock is selling for $46.14. What is the conversion value?
A. $1,009.16
B. $1,015.08
C. $1,038.60
D. $1,049.35
E. $1,053.50
70. A $1,000 par value bond has a market price of $986 and a conversion ratio of 15. The stock is selling for $60.74. What is the conversion value?
A. $903.17
B. $911.10
C. $925.60
D. $930.57
E. $946.49
71. A bond has a par value of $1,000 and a market price of $1,087.20. The conversion price is $40 and the stock price is $41.75. What is the conversion value?
A. $1,043.75
B. $1,250.00
C. $1,481.10
D. $1,500.00
E. $1,652.00
72. A 4.5 percent, semi-annual coupon bond has a face value of $1,000 and a time to maturity of 4 years. The bonds are convertible into shares of common stock at a conversion price of $42.50. The stock price currently is $40.70. Similar, non-convertible bonds have a yield to maturity of 4.5 percent. The intrinsic value of this bond is _____ and the conversion value is _____.
A. $832.62; $982.80
B. $961.06; $957.65
C. $1,014.16; $1,017.50
D. $1,014.16; $982.80
E. $1,006.96; $1,017.50
73. A semi-annual coupon bond has a 6.5 percent coupon rate, a $1,000 face value, a current value of $1,054.54, and 4 years until the first call date. What is the call price if the yield to call is 6.7 percent?
A. $1,000
B. $1,020
C. $1,040
D. $1,060
E. $1,080
74. A bond has 6 years until it can be called, a 7 percent coupon, and a $1,000 face value. The bond has a market value of $1,031.90 and a yield to call of 7.35 percent. What is the call premium?
A. $45
B. $55
C. $65
D. $75
E. $85
75. A bond has a face value of $1,000 and a call price of $1,030. The bond is callable in 3.5 years and pays a 5 percent, semi-annual coupon. What is the current price if the yield to call is 6 percent?
A. $912.36
B. $927.19
C. $966.25
D. $993.24
E. $1,009.01
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