Answered step by step
Verified Expert Solution
Question
1 Approved Answer
What is the duration of a constant-dividend preferred stock at issuance, when its market rate of return is 4.2%? Note that a constant-dividend preferred stock
What is the duration of a constant-dividend preferred stock at issuance, when its market rate of return is 4.2%? Note that a constant-dividend preferred stock is just a no-growth perpetuity. Its market rate of return is comparable to the YTM for a bond. Round your calculations to the nearest 0.01, i.e., two decimal places.
Also show excel formula
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started