Total value of the warrants and the value of each warrant

Assignment Help Financial Management
Reference no: EM13885230

A warrant is a long-term option from a company that gives the holder the right to buy a stated number of shares of the firm’s stock at a specified price for a specified length of time. Generally, warrants are distributed with debt, and they are used to induce investors to buy long-term debt that carries a lower coupon rate than would otherwise be required. The exercise of warrants brings in additional funds to the firm.

A corporation decides to issue 10-year bonds to fund a necessary expansion. If they were straight bonds, they would carry an 7% annual coupon. However, the bonds with warrants can be sold with a 5% coupon. Thus, investors would be paying \$900 in return for the 5% coupon, 10-year bond and 19 warrants.

What is the total value of the warrants and the value of each warrant? Round your answers to the nearest cent.

Value of the warrants = \$

Value of each warrant = \$

Calculate the sharpe ratio of each of the three portfolios

You are currently only invested in the Natasha Fund? (aside from? risk-free securities). It has an expected return of 15% with a volatility of 19%. ?Currently, the? risk-free

History of health problems

?Renee's family has a history of health problems. Her? niece, Abilyn,was recently declined coverage because of a congenital heart defect that she was born with 6 months ago. H

What is your annualized return from these two investments

Suppose you have \$60,000 to invest. You’re considering Miller-Moore Equine Enterprises (MMEE), which is currently selling for \$60 per share. You also notice that a call option

Perform ratio analysis using the tools

Perform a ratio analysis (ROE analysis) using the tools and techniques given in Chapter 12 of the textbook. Specifically, you are to perform analysis of the following ratios:

The Warren Watch Company sells watches for \$25, fixed costs are \$115,000, and variable costs are \$11 per watch. What is the firm's gain or loss at sales of 5,000 watches? Ente

The total dollar amount return

Microsystems Common Stock is selling for \$80 per share and pays a cash dividend of \$2.40 per share. Calculate the current yield. If the stock is expected to rise to \$86.40 in

What are some indications that investors are risk averse

What are some indications that investors are risk averse? How would you as a portfolio manager support these investors? What kind of recommendations would you make? What would

Firm issued bonds several years ago

A firm issued bonds several years ago with a 8% coupon rate. Their bonds are currently trading for \$950 in the market. Which of the following most likely has occurred since th