I have purchased a preferred stock whose par value is 500, Ask an Expert

Finance

I have purchased a preferred stock whose par value is $500. The preferred stock pays a 4.5% dividend. If investors require a 5.5% rate of return for these shares, what price should the preferred stock sell for?

A. $611.11

B. $508.33

C. $409.09

D. $81.82

View complete question

Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M9878413

Have any Question?Write your Review or question?

Related Questions in Basic Finance

The risk-free rate of return is 6 pa wesfarmers ltd has a

The risk-free rate of return is 6% p.a. Wesfarmers Ltd has a β of 0.64. The expected return on the market is 12% p.a. Based on the information provided, answer the following questions. What is the expected return of mark ...

Based on the data provided here calculate the items

Based on the data provided here, calculate the items requested: Annual depreciation $2,500 Current year's loan interest $650 Insurance $680 Average gasoline price $3.50per gallon Parking/tolls $420 Annual mileage 13,2 ...

Ross textiles wishes to measure its cost of common stock

Ross Textiles wishes to measure its cost of common stock equity. The firm's stock is currently selling for $57.50. The firm expects to pay a $3.40 dividend at the end of 2013. The dividends for the past 5 years are shown ...

Question - how do book value and market value differ

Question - How do book value and market value differ? Provide an example found in a peer-reviewed journal article.

Please explain the united states has experienced continuous

Please explain, The United States has experienced continuous current account deficits since the early 1980s. What do you think are the main causes for the deficits and what would be the consequences of continuous US curr ...

Use the bond-yield-plus-risk-premium method to estimate the

Use the bond-yield-plus-risk-premium method to estimate the cost of equity for Galveston Corp. A US Treasury bond yields 2.4%, the long-term bond for Galveston yields 4.4%, Galveston's beta is 1.2, the market risk premiu ...

Net income is 300 million depreciation is 70 million

Net income is 300 million, depreciation is 70 million, capital expenditures are 120 million, investment in working capital is 30 million, interest expenses (before tax) are 40 million, and outstanding debt is 850 million ...

Suppose pepsicos stock has a beta of 57 if the risk-free

Suppose Pepsico's stock has a beta of .57. If the risk-free rate is 3% and the expected return of the market portfolio is 8%, what is Pepsico's equity cost of capital?

Asset management ratios corn products corp ended the year

Asset Management Ratios Corn Products, Corp. ended the year 2008 with an average collection period of 32 days. The firm's credit sales for 2008 were $10.7 million. What is the year-end 2008 balance in accounts receivable ...

Toy is a leading company in the toy and game industry

TOY is a leading company in the toy and game industry. Analysts make the following forecast for the forecast horizon of 20X5 and 20X7. The company has shares outstanding of 100 million at the end of 20X4A. Assume that TO ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Basic Finance Expert