The gain from exercising a warrant is ________ the gain from exercising a comparable call option.
A)less than
B)generally greater than
C)always greater than
D)equal to
E)either equal to or greater than

Question

Quizplus · Accepted Answer

The gain from exercising a warrant is generally less than the gain from exercising a comparable call option. This is because warrants typically have a longer expiration period and a lower strike price than options. Therefore, the cost of acquiring a warrant is usually less than the cost of acquiring an option. However, the potential returns from exercising a warrant are also lower than the potential returns from exercising a comparable call option.

The Gain from Exercising a Warrant Is ________ the Gain