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Phylis corporation is isssuing a 20 year bond with 25 warrents to each bond t 6% annual rate . market rate is for aplain blnd is 7.5% with the same maurity . the warrents can be exercised after 8 years and the warrent holder will be $30 dollar below market price

1. What is the price that the buyer of this bond is paying for each warrants.

2. Calculate pre tax cost of bonds with warrants for the company.

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92766229

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