The following data applies to saunders corporations, Ask an Expert

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The following data applies to Saunders 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%

What is the bond's conversion value?

a) $698.15
b) $734.89
c) $773.57
d) $814.29
e) $857.14

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