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9-8. PREFERRED STOCK VALUATION Ezzell Corporation issued perpetual preferred stock with a 10% annual dividend. The stock currently yields 8%, and its par value is

9-8. PREFERRED STOCK VALUATION Ezzell Corporation issued perpetual preferred stock with a 10% annual dividend. The stock currently yields 8%, and its par value is $100.

a. What is the stocks value?

b. Suppose interest rates rise and pull the preferred stocks yield up to 12% What is its new market value?

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