Answer:
B I and IV
Explanation:
Each bond could be transformed into common stock at $10.50 par value. So the bond should be equivalent to the 95 shares that comes from
= $1,000 ÷ $10.50 per share
= 95 shares
Currently price of the bond is $1,050
Now each share price is
= $1,050 ÷ 95 shares
= $11.05
As the common stock is traded at $10 that represents the stock is less than parity and therefore there is no means to transform the shares
hence, B option is correct
