Question
Justin Co. just sold a bond with 50 warrants attached. The bonds have a 20-year maturity and an annual coupon of 11%, and they were
Justin Co. just sold a bond with 50 warrants attached. The bonds have a 20-year maturity and an annual coupon of 11%, and they were issued at their $1,000 par value. The current yield on similar straight bonds is 12%. What is the implied value of each warrant?
| $1.49 |
| $1.66 |
| $0.00 |
| $1.00 |
| $4.56 |
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Foundations Of Financial Markets And Institutions
Authors: Frank J Fabozzi, Franco G Modigliani, Frank J Jones
4th Edition
0136135315, 978-0136135319
