The correct option. Given information Bonds with detachable warrants are 1000. Par value of bonds with detachable warrants is $1,000. Coupon rate of bonds is 8%. Maturity period of bonds is 10 years. Each detachable warrant is convertible into share at price of $25 per share. Market value of bonds without warrants is $1,080,000. Market value of warrants is $120.

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Chapter 14, Problem 14.10MC

To determine

The correct option.

Given information

Bonds with detachable warrants are 1000.

Par value of bonds with detachable warrants is $1,000.

Coupon rate of bonds is 8%.

Maturity period of bonds is 10 years.

Each detachable warrant is convertible into share at price of $25 per share.

Market value of bonds without warrants is $1,080,000.

Market value of warrants is $120.

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