The intrinsic value of a warrant to buy four shares of Merton stock at $53 per share is $20. What is the current market price of Merton stock?
A) $55.00
B) $59.00
C) $58.00
D) None of these options are correct
C) $58.00
(Stock price - Exercise price) × 4 shares = $20.00 Intrinsic value
(Stock price - $53.00) × 4 = $20.00 Speculative premium
Stock price = $58.00
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