You Own a Bond That Has a Face Value of $1,000

question 53

Multiple Choice

You own a bond that has a face value of $1,000 and a conversion ratio of 25. You have just received notification that the bond is being called at a premium of $40. The stock price is $41.20 a share. You should ________ your bond because the conversion value is ________.

• A)convert; less than the call price by $30.00
• B)convert; greater than the call price by $10.00
• C)convert; greater than the call price by $5.00
• D)not convert; less than the call price by $10.00
• E)not convert; greater than the call price by $30.00

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Definitions:

Libel

Defamation in writing or in some other form (such as a digital recording) having the quality of permanence.

Good Name

The reputation, credibility, or respect that an individual or organization has earned over time.

Reputation Orally

The perception of an individual's or entity's character and standing communicated through spoken word.

Immediate Physical Harm

Direct physical injury or damage that occurs without delay.