Silver and Gold Ltd.(SG) common stock is currently trading at $32 a share.SG's warrants have a strike price of $25 if converted on or before July 1 and can be converted into 1 share of SG.If SG's warrants are currently trading at $12.00,and the intrinsic value of these warrants is $7.00,calculate their speculative premium.
A) $5.00
B) $7.00
C) $8.90
D) $12.00
Correct Answer:
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