Jacobs and Company Has Warrants Outstanding, Which Are Selling at a $2.50

question 89

Multiple Choice

Jacobs and Company has warrants outstanding, which are selling at a $2.50 premium above intrinsic value. Each warrant allows its owner to purchase one share of common stock at $26. If the common stock currently sells for $30, what is the warrant price?

• A)$6.40
• B)$6.75
• C)$7.25
• D)$6.50

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