Question
A $1400 par value 9% preferred stock with quarterly dividends is bought to yield 7% convertible quarterly into perpetuity. However, the preferred stock is actually
A $1400 par value 9% preferred stock with quarterly dividends is bought to yield 7% convertible quarterly into perpetuity. However, the preferred stock is actually called at the end of 8 years at par. Find the nominal yield rate convertible quarterly that an investor would actually earn over the 8-year period.
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