Convertible preferred stock valerian corp convertible preffered sotck has a fixed conversion ratio of 5 share per 1 of preferred stock. the preferred stock pays a dividend of ! 10 per share year. the common stock currently sells for $20 per share and pays a dividend of $1 per share per year. a. judging on the basis of the conversion ratio and the price of teh common shares, what is the current conversion value of each preferred share?

Conversion value = conversion ratio x stock price = 5 x $20 = $100

Based on judgement of the preferred stock price versus the conversion value the investor should change. If converted, the investor has $100 of value against only $96 if she keeps ownership of the preferred stock. If the investor changes to common stock she will start receiving $1.00 per share per year of dividends. Conversion will make $5.00 per year of total dividends. If the investor keeps the preferred they will obtain $10.00 per year of dividends. This extra $5.00 per year in dividends may reason the investor to retain the preferred up until forced to change through use of the call feature.

answer; /// the correct answer is (10) days; /// good luck

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.