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The holder of a $1,000 face value bond can exchange the bond any time for 25 shares of stock. Then the conversion ratio:
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The holder of a $1,000 face value bond can exchange the bond any time for 25 shares of stock. Then the conversion ratio:

User Ada Xu
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Answer:

Conversion ratio is 25:1

Step-by-step explanation:

Conversion ratio explains the number of shares that you can get for one bond. Here the number of shares that you are getting for 1 $1000 face value bond is 25 shares. Therefore, the conversion ratio is 25:1

The conversation ratio can also be calculated by dividing the par value of a bond for a share's price. As we do not have the price of 1 share, we will use the quantity to decide the conversion ratio.

User Guelfey
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