P16.7 Sara-J Co. has a preferred stock outstanding that pays annual dividends of $1.53 a share. At what price would this stock be trading if market yields were 7.16%? Use one of the dividend valuation models (from Chapter 8) to price this stock, assuming you have a 7.16% required rate of return. Are there any similarities between the 2 prices? Explain. If market yields were 7.16%, the price this stock would be trading at is $ . (Round to the nearest cent.) Assuming you have a 7.16% required rate of return, the maximum price you would pay for this stock is $ . (Round to the nearest cent.) Are there any similarities between the 2 prices? Explain. (Select the best answer below.) A. The first method uses the perpetuity model for valuing preferred stock. The second method uses the zero-growth valuation model. The methods result in different prices because the market yield and the individual investor's required rate of return are the same. O B. The first method uses the perpetuity model for valuing preferred stock. The second method uses the zero-growth valuation model. The methods result in the same prices because the market yield and the individual investor's required rate of return are different. O C. The first method uses the perpetuity model for valuing preferred stock. The second method uses the zero-growth valuation model. Both methods result in the same price, which will occur when the market yield and an individual investor's required rate of return are the same