📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

  • google app store apple app store

    • Question

      A company’s 1000 par preferred stock pays a Rs 50

      annual dividend and has a required rate of return is 8%. Calculate the value of the preferred stock.
      A 500 Correct Answer Incorrect Answer
      B 625 Correct Answer Incorrect Answer
      C 1000 Correct Answer Incorrect Answer
      D 800 Correct Answer Incorrect Answer
      E 900 Correct Answer Incorrect Answer

      Solution

      Cost of preferred stock = dividend / required rate of return = 50/0.08 =625

      Practice Next
      ask-question