Question
A. What is the price of one share of 6% preferred stock that has a par value of $50 while investors have a required rate
A. What is the price of one share of 6% preferred stock that has a par value of $50 while investors have a required rate of return of 9%?
. B. What is the required rate of return on a $7 preferred stock with a market price of $67 and a par value of $50?
. C. Using the dividend growth model, what is the value of one share of a common stock that paid a dividend of $3.10 yesterday when investors require a 9% return on their investment and who perceive that dividends will grow at 5% per year for the foreseeable future?
. D. What is a stock's total rate of return if it sells for $60 in the market, paid a dividend of $3.21 yesterday, and investors anticipate the company's dividend will grow at 4% for the foreseeable future?
. E. Assuming a stock sells for $71 and paid a $2 dividend yesterday, what is the stock's capital gains yield if it's dividends are expected to grow at 5.5% each year for the foreseeable future?
. F. What is a stock's total rate of return if it paid a dividend of $4 yesterday, sells for $39, and investors feel that dividends will grow at 6% per year for the foreseeable future?
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