SIE Exam Practice Question 626
Question: 626
Which of the following accurately describes the difference between rights and warrants?
(1) A warrant may be attached to new debt or preferred issues to make the issues more attractive to buyers.
(2) Rights and warrants have different lifespans.
(3) Warrants usually expire within a few weeks.
(4) Rights may continue without expiring for up to several years.
Correct Answer: B
Explanation:
A warrant may be attached to new debt or preferred issues to make the issues more attractive to buyers. A difference between rights and warrants is their lifespan. Rights usually expire within a few weeks, and warrants may continue without expiring for up to several years.
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