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Value of conversion option to bond holder is 220 and rate...

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International Finance and Treasury
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Value of conversion option to bond holder is $220 and rate of return on non-convertible bond is $350 then rate of return on convertible bond is

Answer & Solution
Correct Answer: Option B
Rate of return on convertible bond = Rate of return on non-convertible bond - Value of conversion option to bond holder
= $350 - $220 = $130.
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