Which the Following Is True of Stock Purchase Warrants

question 3

Multiple Choice

Which the following is true of stock purchase warrants?

• A) When a firm makes a large issue of debt, the attachment of stock purchase warrants may deteriorate the marketability of the issue.
• B) Warrants are similar to conversion features on debt.
• C) Suppliers of debt are more likely to require warrants on an issue of debt from an existing corporation than from a new firm.
• D) The attachment of warrants increases the required interest rate.

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