Preston toy co has warrants outstanding that allow the, Ask an Expert

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Preston Toy Co. has warrants outstanding that allow the holder to purchase a share of stock for $12 (exercise price). The common stock is currently selling for $20, while the warrant is selling for $11.65 per share.

a. What is the intrinsic (minimum) value of this warrant? (Do not round intermediate calculations and round your answer to 2 decimal places.)

b. What is the speculative premium on this warrant? (Do not round intermediate calculations and round your answer to 2 decimal places.)

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92360030

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