The Minimum flOor Value of a Convertible Bond

question 415

Multiple Choice

The minimum floor value of a convertible bond:

• A) Is the greater of the bond's face value or the conversion value.
• B) Is always less than the conversion value of the bond.
• C) Is equal to the straight bond value of the security.
• D) Is the greater of the straight bond value or the conversion value.
• E) Is equal to the conversion value of the security.

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