Ashford 3 : - Week 2 - Quiz

Time Remaining:

Question 1. 1. E.I. du Pont de Nemours & Co. has an issue of $4.50 preferred stock outstanding. It is currently selling for $108. What rate of return are investors requiring? (Points : 1)

4.17% 4.5% 9% 24%.

Question 2. 2. We would expect that, all else being equal, investors would pay more for a stock with a higher dividend growth rate. Assume a stock has just paid a $2.00-per-share dividend. Analysts believe that future dividends will grow at a 6% rate. The required rate of return is 11%. What would the stock price be? (Points : 1)

$29.71 $31.71 $40.00 $42.40

Question 3. 3. Which of the following is NOT true of preferred stock? (Points : 1)

Preferred stock generally pays a fixed dividend. Preferred stock is a perpetuity. Dividends on preferred stock are tax deductible. Preferred stock dividends have a higher priority than common stock dividends.

Question 4. 4. The name