However, similar to bonds, preferred shareholders receive a fixed payment--their dividend -before the company's residual earnings are paid out to its common shareholders and, as with common stock, preferred shareholders can benefit from an appreciation in the value of the firm's stock securities Consider the following case of Anderson Animations Corporation (AAC): Anderson Animations Corporation (AAC) pays an annual dividend rate of 9.80% on its preferred stock that currently returns 13.13% and has a par value of $100.00 per share. What is the value of 's preferred stock? $100.00 per share O $111.96 per share O $89.57 per share O $74.64 per share Suppose that due to high inflation, interest rates rise and pull the preferred stock' yield to 17.07%. The value of the preferred stock will