Wasabi Inc. and Tempura Corporation have both issued 5 million common stocks. In addition, Wasabi Inc. has issued $5000000 of 11% convertible bonds, par value $100, with conversion ratio of 40 common stocks in five years' time at maturity. If not converted, the bonds can be redeemed at maturity by the bondholders at \$111. Tempura Corporation has in issue 800000 warrants, each with an exercise price of $2.50 for one common stock in Tempura Corporation. The warrants can be exercised in five years' time. Calculate the value of each convertible bond and each warrant in five years' time, for the following situations: (i) The stock price of both companies in five years' time is $2 per share; (4 marks) (ii) The stock price of both companies in five years' time is $3 per share. (4 marks) (iii) For each of the situations in (i) and (ii), advise holders of the above securities whether to exercise their respective conversion and warrant. (2 marks) Wasabi Inc. and Tempura Corporation have both issued 5 million common stocks. In addition, Wasabi Inc. has issued $5000000 of 11% convertible bonds, par value $100, with conversion ratio of 40 common stocks in five years' time at maturity. If not converted, the bonds can be redeemed at maturity by the bondholders at \$111. Tempura Corporation has in issue 800000 warrants, each with an exercise price of $2.50 for one common stock in Tempura Corporation. The warrants can be exercised in five years' time. Calculate the value of each convertible bond and each warrant in five years' time, for the following situations: (i) The stock price of both companies in five years' time is $2 per share; (4 marks) (ii) The stock price of both companies in five years' time is $3 per share. (4 marks) (iii) For each of the situations in (i) and (ii), advise holders of the above securities whether to exercise their respective conversion and warrant. (2 marks)