This stock is for possible purchase

Par Value $100

Dividend Rate 5% per year

Payment Schedule quarterly

No Maturity date

The required rate of return is 4% per year, compounded quarterly. The current market price for this stock is $660 per share.

A. Draw a timeline showing the expected dividends for this preferred stock.

B. What is the value of this stock based on the required rate of return?

C. What is the expected return based on the market price?

D. Based on the results from part b and c, would it be wise to invest in this stock? Why or why not?