Explore BrainMass

# Stock, Bond, Warrants

Not what you're looking for? Search our solutions OR ask your own Custom question.

This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

1. The Burma Hat Company's warrant is trading for \$10.20. The warrant carries the options to purchase two shares of common stock for \$48.00. What is the speculative premium if the stock price is \$51.03?

2.Allais Company's bond has a @114 annual coupon, maturing in 10 years at a value of \$1,000 has a current market price of \$1140. What is the nominal yield of the bond?

3. A firm as \$2,000,000 in its common stock account and \$20,000,000 in its paid-capital account. The firm issued 500,000 shares of common stock. What is the par value of the common stock?

#### Solution Preview

1. The Burma Hat Company's warrant is trading for \$10.20.Â Â The warrant carries the options to purchase two shares of common stock for \$48.00.Â Â What is the speculative premium if the stock price is \$51.03?

Intrinsic value = Number of shares that can be purchased x (Current market price- Exercise price)
or Intrinsic value = ...

#### Solution Summary

Calculates speculative premium, nominal yield of the bond and par value of the common stock.

\$2.49