Question

3) Convertible bonds are attractive to investors because A) the issuing company cannot retire the bonds before maturity. B) they can be converted into stock by the issuing company. C) they usually carry a higher rate of interest than non-convertible bonds. D) they usually carry a lower rate of interest than non-convertible bonds. E) they can be converted into stock at the holder's option. 4) The cash proceeds received from issuing a bond are less than the face value of the bond. It is apparent that the bond was issued at A) face value. B) a premium. C) a discount. D) par value. E) nominal value.

Answer 1

O Convertible bonds are be converted into common stock at those bonds, which can a specified number of the option of the holder Answer E. 12 When Bonds are issued at discount the proveds from that issue will be less That the face value. rate = 5% - fare vallie = $100000 Issued @ = asooo. I proceeds a will be 95000 e 5000 will be discount . we have to pay $100000 at the time of credemption : Answer @ A discount.