FINRA Series 7 General Securities Representative Qualification Examination (GS) Series-7 Question # 30 Topic 4 Discussion

FINRA Series 7 General Securities Representative Qualification Examination (GS) Series-7 Question # 30 Topic 4 Discussion

Series-7 Exam Topic 4 Question 30 Discussion:
Question #: 30
Topic #: 4

Bubba wants to buy a $4 convertible preferred with that has a $50 par value and is exchangeable for common stock at $47.50. If the preferred stock is trading at 52, what does Bubba calculate as the common stock price in order to be at parity with the preferred?


A.

47.50


B.

52.00


C.

a little less than 49.38


D.

a little more than 54.50


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