Multiple Choice
Herbert Engineering is issuing new 22-year bonds that have warrants attached.If not for the attached warrants,the bonds would carry a 10.3% annual interest rate.However,with the warrants attached the bonds will pay a 6.3% annual coupon.There are 30 warrants attached to each bond,which has a par value of $1,000.What is the value of the straight-debt portion of the bonds? Do not round your intermediate calculations.
A) $558.10
B) $656.58
C) $623.75
D) $689.41
E) $525.27
Correct Answer:
Verified
Correct Answer:
Verified
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