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A bond with 5 warrants attached to it is issued with a 3.5% coupon, 7 years in maturity, $1000 par value, and is sold for

A bond with 5 warrants attached to it is issued with a 3.5% coupon, 7 years in maturity, $1000 par value, and is sold for $1000. The going rate of interest is 5%.

A. What does the warrant do for you as the bondholder in this example, if you exercise it?

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