Bond investors the chance to profit from the firms potential

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Warrents give bond investors the chance to profit from the firm's upside potential, leading some to compare warrants to a long-term call option. However, some factors distinguish warrants from call options. Which of the following statements about their differences is correct?

a. Exercising warrants can lead to the dilution of existing shareholders' value

b. Exercising call options can lead to the dilution of existing shareholders' value

Reference no: EM13878555

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