Relationships Among Premiums The leftmost portion Market value line of the graph represents a firm 3 Convertible that is in financial security Premium distress value The stronger the >co financial health of Straight the firm the greater o bond value the straight bond value until it reaches a ceiling level Market Value of common Stock 22-1622-16 Relationships Among Premiums The leftmost portion of the graph represents a firm that is in financial distress. The stronger the financial health of the firm the greater the straight bond value until it reaches a ceiling level. Value of Convertible Security Market Value of Common Stock Market value line Premium Straight bond value Convertible security value