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Suppose an All-Equity Firm Has a Value of $10,000 and 100

Question 175

Multiple Choice

Suppose an all-equity firm has a value of $10,000 and 100 shares outstanding. The firm has issued 25 warrants, each of which may be exchanged for one share. The warrants have an exercise price of $75. If the firm will be worth $9,800 in one period (before exercise) , what will the price of the shares be assuming the warrants are exercised?


A) $88.20
B) $91.60
C) $93.40
D) $96.00
E) $98.40

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