A ______________ permits the firm to raise additional funds at some point in the future by selling common stock and thereby shifting the firm's capital structure to a less highly levered position.

Question

Quizplus · Accepted Answer

A stock-purchase warrant gives the holder the right to purchase common stock at a predetermined price for a set period of time. By exercising these warrants, the firm can raise additional funds through the sale of common stock, thereby reducing their reliance on debt and shifting the capital structure to a less highly levered position.

A ______________ Permits the Firm to Raise Additional Funds at Some