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inna [77]
1 year ago
7

A convertible debenture callable at 101 is trading at 105. The debenture carries 4% coupon and is convertible at $25. The common

stock is trading at $27. If an investor bought the debenture and converted, the profit would be
Business
1 answer:
andrey2020 [161]1 year ago
8 0

If an investor bought the debenture and converted it, the profit would be $30.

First, calculate the number of shares each bond will convert to:

$1,000 (par) divided by $25 per share equals 40 shares per bond. With a market value of 105, each bond costs $1,050.

What is the stock parity price?

$1,050 divided by 40 shares equals $26.25 per share. The current market value of the stock minus stock parity price equals profit (or loss).

$27.00 − $26.25 = $0.75 per share × 40 shares = $30.

What is convertible debenture?

A long-term debt with the option to convert into stock shares after a predetermined amount of time is known as a convertible debenture. Common examples of convertible debentures include unsecured bonds or loans with little to no underlying security to back the commitment.

How are debentures converted to shares?

Equity shares are created out of a debenture. The holders of debentures are asked to return debenture certificates after sending them a notification of the conversion. The allocation of shares is handled by the secretary. Changes must be submitted to the Register of Charges after allotment.

Learn more about convertible debenture: brainly.com/question/16976826

#SPJ4

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valentina_108 [34]

Answer:

d. .64.

Explanation:

Price elasticity of demand measure the responsiveness of demand against change in the price of given product. It measures the ratio of change in demand to change in price.

Change in demand = ( 2200 - 2000 ) / [ (2200+2000)/2 ] = 200 / 2100 = 0.0952

Change in price = ( 1.25 - 1.45 ) / [ (1.25+1.45)/2 ] = 0.2 / 1.35 = 0.148

Elasticity of Demand = Change in demand / change in price = 0.0952 / 0.148 = 0.643 = 0.64

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A small open economy with a fixed exchange rate e2 is initially at equilibrium A with LM*1 and equilibrium output Y1. If there i
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If there is an increase in government spending, the new equilibrium will be at <u>B</u> holding everything else constant.

<h3>What is government spending?</h3>

Government spending can be the defined as the money spent on goods and service or money spent by government to provide services to the public.

An increase in government spending will tend to lead to increase the demand of goods and service which inturn means that consumption expenditure will as well increase.

Inconclusion the new equilibrium will be at <u>B</u> holding everything else constant.

Learn more about Government spending here:brainly.com/question/27232573

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In an organic organization:_______
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d. employees are encouraged to develop knowledge and expertise outside of their specialization.

Explanation:

An organizational structure can be defined as the process which typically involves dividing an organization into various functional units.

Basically, the organizational structure comprises of three (3) main dimensions and these are;

I. The vertical dimension: this is typically the decision-making responsibilities (decentralization and centralization).

II. The horizontal dimension: this divides the organization into subunits.

III. Integrating mechanisms: it is based typically on the strategic mechanism that controls the various subunits within an organization.

An employee can be defined as an individual who is employed by an employer of labor to perform specific tasks, duties or functions in an organization.

Basically, an employee is saddled with the responsibility of providing specific services to the organization or company where he is currently employed while being paid a certain amount of money hourly, daily, weekly, or monthly depending on the contractual agreement between the two parties (employer and employee).

In an organic organization unlike a mechanistic organisation, employees are encouraged to develop knowledge and expertise outside of their specialization rather than being static or inflexible.

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