Which of the following statements about warrants is true?
A) Warrants are usually issued in conjunction with a security offering.
B) Warrants are issued by individuals.
C) Warrant exercise will not increase the number of shares outstanding.
D) Warrant exercise will increase earnings per share.
E) Warrants may not be traded separately from the security with which they were issued.

Question

Quizplus · Accepted Answer

Warrants are often issued alongside a security offering to make the offering more attractive to investors by giving them the right, but not the obligation, to purchase the company's stock at a specific price within a certain time frame. This can increase the appeal of the security offering.

Which of the Following Statements About Warrants Is True