A bond with 20 detachable warrants has just been offered for sale at $1,000. The bond matures
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A bond with 20 detachable warrants has just been offered for sale at $1,000. The bond matures in 20 years and has an annual coupon of $18. Each warrant gives the owner the right to purchase two shares of stock in the company at $45 per share. Ordinary bonds (with no warrants) of similar quality are priced to yield 5 percent. What is the value of one warrant?
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Related Book For 
Fundamentals Of Corporate Finance
ISBN: 9781265553609
13th Edition
Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan
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