The preferred stock of Acme International is selling currently at $187.5. If your required rate of...
The preferred stock of Acme International is selling currently at $187.5. If your required rate of return is 8 percent, what is the dividend paid by this stock?
| a. |
$10.88 |
|
| b. |
$12 |
|
| c. |
$13.6 |
|
| d. |
$15 |
Homework Answers
D) $15
Explanation:
Price. = annual dividend / required rate of return
187.5 = annual dividend / 0.08
Dividend = 187.5 × 0.08
= $15
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