Slater Mines Just Called Its Outstanding Bonds at a Call

question 69

Multiple Choice

Slater Mines just called its outstanding bonds at a call price of $1,025. The bonds have a conversion price of $33.33 and a par value of $1,000. The stock price is currently $33.10. In response to this call, the bondholders should ________ because ________.

• A)accept the call; the call price exceeds the conversion value
• B)accept the call; they have no other choice
• C)convert their bonds; the conversion price exceeds the par value by $37.90
• D)convert their bonds; the conversion price exceeds the call price by $12.90
• E)elect to continue holding their bonds; they want to continue receiving the interest payments

Understand how to calculate changes in purchasing power due to inflation or deflation.

Learn the process of adjusting wages or other financial figures for inflation using the CPI.

Recognize the major categories in consumer spending and their impact on the CPI.

Understand the role of quality changes and consumer choice in the calculation of the CPI.

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