GCC Corporation is planning to issue bonds with warrants. Which of the following
ID: 2778534 • Letter: G
Question
GCC Corporation is planning to issue bonds with warrants. Which of the following events/actions would decrease the chance that GCC warrants will be exercised, other things held constant?
GCC’s stock price suddenly increases.
The exercise price of GCC’s warrants is increased.
The time to expiration of the warrants is increased.
The time to maturity of GCC’s bonds is increased.
GCC’s stock price is more volatile.
GCC’s stock price suddenly increases.
The exercise price of GCC’s warrants is increased.
The time to expiration of the warrants is increased.
The time to maturity of GCC’s bonds is increased.
GCC’s stock price is more volatile.
Explanation / Answer
he exercise price of GCC’s warrants is increased.
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