Multiple Choice
Thomson Engineering is issuing new 20-year bonds that have warrants attached.If not for the attached warrants,the bonds would carry an 11% annual interest rate.However,with the warrants attached the bonds will pay an 8% annual coupon.There are 30 warrants attached to each bond,which have a par value of $1,000.What is the value of the straight-debt portion of the bonds?
A) $652.55
B) $686.89
C) $723.05
D) $761.10
E) $799.16
Correct Answer:
Verified
Correct Answer:
Verified
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