1. Preston Toy Co. has warrants outstanding that allow the holder to purchase a share of stock...
Question:
1. Preston Toy Co. has warrants outstanding that allow the holder to purchase a share of stock for $22 (exercise price). The common stock is currently selling for
$28, while the warrant is selling for $9.25 per share.
a. What is the intrinsic (minimum) value of this warrant?
b. What is the speculative premium on this warrant?
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Mehwish Aziz
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Related Book For 
Foundations Of Financial Management
ISBN: 9780073382388
13th Edition
Authors: Stanley B. Block, Geoffrey A. Hirt, Bartley R. Danielsen
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