A Warrant That Does Not Expire Until Several Years into the Future

question 17

Multiple Choice

A warrant that does not expire until several years into the future provides its owner the opportunity to buy a stock. If the stock price rises, the warrant will probably sell for

• A) less than its intrinsic value.
• B) exactly its intrinsic value.
• C) more than its intrinsic value.
• D) less than or equal to its intrinsic value.