investment

A certain 6

6​% annual coupon rate convertible bond​ ;(maturing in 20​ ;years) is convertible at the​ ;holder’s option into 20

20 shares of common stock. The bond is currently trading at ​$800

800. The stock​ ;(which pays 83

83​¢ a share in annual​ ;dividends) is currently priced in the market at ​$32.85

32.85 a share.

a. What is the​ ;bond’s conversion​ ;price?

b. What is its conversion​ ;ratio?

c. What is the conversion value of this​ ;issue? What is its conversion​ ;parity?

d. What is the conversion​ ;premium, in dollars and as a​ ;percentage?

e. What is the​ ;bond’s payback​ ;period?

f. If comparably​ ;rated, nonconvertible bonds sell to yield 8 % comma

8%, what is the investment value of the​ ;convertible?

a. The​ ;bond’s conversion price is ​$

;(Round to the nearest​ ;cent.)

b. The conversion ratio is

​(Round to the nearest​ ;integer.)

c. The conversion value of this issue is ​$

;(Round to the nearest​ ;cent.)

The conversion parity of this issue is ​$

​(Round to the nearest​ ;cent.)

d.  The conversion premium in dollars is ​$

;(Round to the nearest​ ;cent.)

The conversion premium as a percentage is

(Round to two decimal​ ;places.)

e. The​ ;bond’s payback period is

 ​(Round to one decimal​ ;place.)

f. The investment value of the convertible is ​$

nothing

.(Round to the nearest​ ;cent.)

Enter your answer in each of the answer boxes.