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The market value and the book value of BlackBeards one million preferred shares are $40,000,000 and $35,000,000, respectively. The preferred shares pay an annual dividend

The market value and the book value of BlackBeards one million preferred shares are $40,000,000 and $35,000,000, respectively. The preferred shares pay an annual dividend of 8 percent. What is the risk premium associated with these shares if the riskfree rate is 3.25 percent?

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