Explore BrainMass

Explore BrainMass

    Hybrid Financing: Orient Airlines' Common Stock

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Orient Airlines' common stock currently sells for $33, and its 8% convertible debentures (issued at par, or $1,000) sell for $850. Each debenture can be converted into 25 shares of common stock at any time before 2017. What is the conversion value of the bond?

    A. $707.33
    B. $744.56
    C. $783.75
    D. $825.00
    E. $866.25

    © BrainMass Inc. brainmass.com June 3, 2020, 8:38 pm ad1c9bdddf
    https://brainmass.com/business/finance/hybrid-financing-orient-airlines-common-stock-146821

    Solution Preview

    Hybrid Financing
    Orient Airlines' common stock currently sells for $33, and its 8% convertible debentures (issued at par, or ...

    Solution Summary

    This solution provides calculations for conversion value.

    $2.19

    ADVERTISEMENT