Jones and Smith Company has just issued convertible bonds that have a coupon rate of...
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Jones and Smith Company has just issued convertible bonds that have a coupon rate of 10 percent and a conversion ratio of 25 shares to one bond. They mature in 20 years and pay semiannual coupons. If similar straight debt has a nominal return of 14 percent, what price will investors pay for the conversion privilege if the bonds currently are selling in par
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