Which One of the Following Statements Related to Convertible Bonds

question 72

Multiple Choice

Which one of the following statements related to convertible bonds is correct?

• A)Convertible bonds have a maximum value equal to the bond's intrinsic value.
• B)Convertible bonds have limited downside risk with unlimited upside potential.
• C)A convertible bond is in the money when its call price is greater than its conversion value.
• D)Convertible bonds must be converted prior to or on the maturity date.
• E)Convertible bonds must be converted once they are called.

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