15. Which of the following statements about warrants and convertibles is FALSE?

Question

15.       Which of the following statements about warrants and convertibles is FALSE?

a.   The value of both warrants and convertibles depends on the stock price.

b.   One primary difference between warrants and convertibles is that warrants bring in additional funds to the firm when exercised while convertibles reduce debt when exercised.

c.   The coupon rate on convertible debt is higher than the coupon rate on similar straight debt because convertibles are riskier.

d.   Warrants and Convertibles are used by corporations in order to get a lower rate on their debt.

Explanation / Answer

a.   The value of both warrants and convertibles depends on the stock price.

Only value ofWarrrants depends on stock price

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.