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Why Would a Convertible Bond Increase Much More in Value

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Why would a convertible bond increase much more in value than a bond that is not convertible?


Definitions:

Marginal Revenue

The additional income earned from the sale of one more unit of a product or service.

Cheese

A dairy product derived from milk that is produced in a wide range of flavors, textures, and forms by coagulating the milk protein casein.

Monopolist

An entity with exclusive control over the supply of a particular good or service, giving it the power to control prices and exclude competition.

Total Revenue

Total revenue is the entire amount of money received by a company from its business activities, such as sales of goods and services, before any costs or expenses are deducted.

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