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Preferred stock valuation Earley Corporation issued perpetual preferred stock with a 10% annual dividend. The stock currently yields 9%, and its par value is $100.
Preferred stock valuation
Earley Corporation issued perpetual preferred stock with a 10% annual dividend. The stock currently yields 9%, and its par value is $100.
- a.What is the stock's value? Round your answer to two decimal places. $
- b.Suppose interest rates rise and pull the preferred stock's yield up to 14%. What is its new market value? Round your answer to two decimal places. $
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International Financial Reporting A Practical Guide
Authors: Alan Melville
6th edition
1292200743, 1292200766, 9781292200767, 978-1292200743
