Suppose National Petroleum Refiners Corporation (NPR) pays an annual dividend rate of 10.40% on its preferred stock that currently returns 13.94% and has a par value of $100.00 per share. What is the value of NPRs preferred stock?

$74.61 per share

$89.53 per share

$111.91 per share

$100.00 per share

Suppose that there is high unemployment, which causes interest rates to fall, which in turn pulls the preferred stocks yield to 8.36%. The value of the preferred stock will

increase

decrease