Which of the following is an advantage of convertible bonds? Investors can conve
ID: 2823975 • Letter: W
Question
Which of the following is an advantage of convertible bonds?
Investors can convert the bonds into higher coupon rate bonds.
Investors are paid a penalty on the conversion of the bonds.
Investors are redeemed for the difference between the face value and the market price on redemption of the bonds.
Investors can choose to hold the company's bonds or convert the bonds into its common stock.
Investors can claim interest for the remaining life of the bonds on the bonds' early conversion.
Which of the following is an advantage of convertible bonds?
a.Investors can convert the bonds into higher coupon rate bonds.
b.Investors are paid a penalty on the conversion of the bonds.
c.Investors are redeemed for the difference between the face value and the market price on redemption of the bonds.
d.Investors can choose to hold the company's bonds or convert the bonds into its common stock.
e.Investors can claim interest for the remaining life of the bonds on the bonds' early conversion.
Explanation / Answer
Convertible bonds are bond which can be converted into common stocks after some time. Correct option is option D.
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