Chapter 16 Financial instrument

Couldn’t you please clarify some issues:
1. example 4 – convertible debenture. In theory part you say that we should use effective rate with issue cost but when you perform the example 4 you use interest rate without the convertion.
And in the paper answer there is different way of solving and another answer. Where is correct and why.

2. Example 2 Financial assets. Why we consider that Norman bought 100,000 shares for trading purposes (point 1) and why we consider that 200,000 is held strategically for long-term when the case says “to realise the gains in the future” – doesnt it mean to trade with difference in FV. How to distinguish where is the purpose to realise difference between FV and where there is purpose to hold assets in order to collect contractual cash flows?

Thanks in advance