Goldman Sachs issues $10 million in three-year convertible bonds with a 8% yield to maturity and a 35% premium. If Goldman Sachs’ stock was trading at $45 at the time of the convertible bonds issue and is trading presently at $50, beyond which market price the stock should trade to make the bondholders starting converting their bonds into stocks? (CHOOSE THE CLOSEST ANSWER) Group of answer choices $45. $50. $67.50. $60.75. $48.60.

Goldman Sachs issues $10 million in three-year convertible bonds with a 8% yield to maturity and a 35% premium. If Goldman Sachs’ stock was trading at $45 at the time of the convertible bonds issue and is trading presently at $50, beyond which market price the stock should trade to make the bondholders starting converting their bonds into stocks? (CHOOSE THE CLOSEST ANSWER) Group of answer choices $45. $50. $67.50. $60.75. $48.60.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter20: Financing With Derivatives

Section: Chapter Questions

Problem 4P

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