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Angelo Company wants to sell some 20-year, annual interest, $1,000 par value bonds. Each bond has 75 warrants attached to it. The firm's straight bonds
Angelo Company wants to sell some 20-year, annual interest, $1,000 par value bonds. Each bond has 75 warrants attached to it. The firm's straight bonds yield 10%. Each warrant is expected to have a market value of $2.00. What coupon interest rate must the company set on the bonds in order to sell the bonds-with-warrants at par?
A. 6.981%
B. 7.832%
C. 8.240%
D. 9.656%
E. 10.084%
F. 11.798%
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