3. The cost of preferred stock Preferred stock is a bybrid security, because it has some characteristics typical of debt and others typical of equity. The following table lists various. characteristics of preferred stock. Determine which of these characteristics is consistent with debt and which is consistent with equity. Consider the case of numbull Enterprises: At the present time, Tumbull Enterprises does not have any preferred stock outstanding but is looking to include preferred stock in iss capital structure in the future, Tumbull has found some institutional imvestors that are wiling to purchase its preferred stock issue provided that it pays a perpetial dividend of $12 per share. If the imvestors pay $137,66 per share for their investment, then Turnbull's cost of preferred stock (rounded to four decimal places) will be