The exercise price of a warrant is $45 per share; current market price of the common stock is $55; number of shares that can be purchased by exercising the warrant is 5. Calculate the exercise value of the warrant.

Question

Quizplus · Accepted Answer

The exercise value of a warrant is calculated by subtracting the exercise price from the current market price of the stock, then multiplying by the number of shares that can be purchased. Here, ($55 - $45) * 5 = $10 * 5 = $50.

The Exercise Price of a Warrant Is $45 Per Share;