Many years ago, Minnow Bait and Tackle issued preferred
stock. The stock pays an annual dividend...

Question

Many years ago, Minnow Bait and Tackle issued preferred
stock. The stock pays an annual dividend equal to $6.80. If the required rate
of return on similar risk investments is 8 percent, what should be the market
value of Minnow’s preferred stock?
.

Robert · Accepted Answer

Order id: PPa200215_182868_6 
The market value of the preference stock = Dividend per share / Required Return 
=6.8/0.08 
= $ 85 per share.

Many years ago, Minnow Bait and Tackle issued preferred stock. The stock pays an annual dividend equal to $6.80. If the required rate of return on similar risk investments is 8 percent, what should be...

Solution

Answer To This Question Is Available To Download

Related Questions & Answers

Submit New Assignment