The main reason for investor to use convertible bonds is: 1) to realize his strategic aim to become a new owner or co-owner of the profitable project or enterprise in future; 2) to diversify his risk by investing in pilot venture projects; 3) to make the project more profitable; 4) to receive higher coupon payments.

The main reason for investor to use convertible bonds is: 1) to realize his strategic aim to become a new owner or co-owner of the profitable project or enterprise in future; 2) to diversify his risk by investing in pilot venture projects; 3) to make the project more profitable; 4) to receive higher coupon payments.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter20: Hybrid Financing: Preferred Stock, Warrants, And Convertibles

Section: Chapter Questions

Problem 6Q

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