The value of the warrant increases as the market price of the underlying shares rises.

Name: The value of the warrant increases as the market price of the underlying shares rises.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

This statement is true as the price of the warrant is determined by the difference between the underlying share's market price and the exercise, or strike, price of the warrant. Therefore, as the market price of the underlying shares increases, the value of the warrant also increases.

The Value of the Warrant Increases as the Market Price