A companys perpetual preferred shares pay a semiannual dividend of $1.50. The next dividend will be paid

Question:

A company’s perpetual preferred shares pay a semiannual dividend of $1.50. The next dividend will be paid tomorrow.
a. At what price would the shares provide an investor with a 4.5% semiannually compounded rate of return? The investor will receive tomorrow’s dividend.
b. If the shares are trading at $70, what nominal rate of return will they provide to a purchaser?

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