What is the approximate price of the leyda bond

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A) Assume that Leyda Inc. has an outstanding bond with a 6.5% annual coupon, exactly 10 years to maturity, a par value of $1000 and a yield of 5%. The bond is convertible into 100 shares of Leyda stock, which is currently priced at $10.25 per share. What is the approximate price of the Leyda bond?

B) Assume that Cullop Inc. has issued a bond with a 6.5% annual coupon, 10 years to maturity, a par value of $1000 and a yield of 5%. The bond is a deferred coupon bond and its first coupon payment will be made in exactly 4 years. What is the price of the bond?

Reference no: EM13909611

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