Enterprises Inc.'s capital structure consists of 18 million shares of common stock and 1 million warrants. Each warrant entitles the holder to acquire one share of common stock for $17 if exercised. The stock is currently trading at $26, and each warrant is worth $10. And what's the company's new value? What is the current price of the stock?

Enterprises Inc.'s capital structure consists of 18 million shares of common stock and 1 million warrants. Each warrant entitles the holder to acquire one share of common stock for $17 if exercised. The stock is currently trading at $26, and each warrant is worth $10. And what's the company's new value? What is the current price of the stock?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter20: Financing With Derivatives

Section: Chapter Questions

Problem 8P

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