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6. There is a preferred stock, which pays $8, has market rates of 8% and is callable at year 3 at 109 of its value.

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6. There is a preferred stock, which pays $8, has market rates of 8% and is callable at year 3 at 109 of its value. If it is not called, then it keeps paying $8 to an investor. a) Derive the value at year zero assuming it will be called. b) Derive its value, after it is not called

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