JDH Inc. presently has warrants outstanding that expire 5 years from today. Each warrant entitles the holder to purchase 2 shares of the company's common stock at an exercise price of $30 a share. The warrants currently are trading at $4 each, and the JDH common stock currently is trading at $28 a share. Calculate the warrants' formula value.
A) -$4.00
B) -$2.00
C) $0.00
D) $2.00
Correct Answer:
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