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Graybar Recently Sold a Convertible Bond with a $1,000 Par

Question 49

Multiple Choice

Graybar recently sold a convertible bond with a $1,000 par value for a flotation cost of 2 percent (each bond produced $980 for the firm) .What is the conversion price if the conversion ratio is 22?


A) $44.55
B) $45.45
C) $50.00
D) $4.45

Correct Answer:

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