When warrants are exercised,what happens as a result?

Question

Quizplus · Accepted Answer

When warrants are exercised, it means that the holder of the warrant chooses to buy the underlying common shares at the predetermined exercise price. This results in an increase in the number of common shares outstanding because new shares are issued to the warrant holder. Thus, choice C is correct. Choices A, B, and D are incorrect because they do not accurately reflect the outcome of warrant exercise.

When Warrants Are Exercised,what Happens as a Result