SIE Exam Practice Question 883
Question: 883
A convertible bond is issued with a par value of $10,000. The bond is currently priced at $9,500, and the underlying share price is $200.
The conversion condition for the bond is:
Correct Answer: C
Explanation:
Because the current price of the convertible bond is $9,500, the conversion value is greater than the bond's price, or above parity.
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