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Question
Neuman Corporation Convertible Bonds
The following data apply to Neuman Corporation's convertible bonds:
Maturity: 10 Stock price: $30.00
Par value: $1,000.00 Conversion price: $35.00
Annual coupon: 5.00% Straight-debt yield: 8.00%
Refer to the data for the Neuman Corporation's convertible bonds. What is the bond's conversion value?a. $698.15
b. $734.89
c. $773.57
d. $814.29
e. $857.14
Answer
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