The Conversion Premium Is Defined as Which of the Following

question 24

Multiple Choice

The conversion premium is defined as which of the following?

• A)The number of shares that a convertible security can be exchanged for.
• B)The price at which a convertible security can be converted into common shares.
• C)The value of a convertible security if it is immediately converted into common shares.
• D)The percentage difference between the value at which the bonds are trading and their conversion value.

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Definitions:

Federal Government

The government system that unites separate states or provinces within a country under a central authority but allows these states certain powers of self-government.

Entitlement

Government programs guaranteeing certain benefits to a particular group or segment of the population, such as Social Security and Medicare.

Social Security

A government program designed to provide financial assistance to people who are retired, disabled, or in other specific situations that affect their earning capacity.

Medicare

A federal health insurance program in the United States for people aged 65 and older, and for some younger individuals with disabilities.