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PREFERRED STOCK RETURNS Arondale Aeronautics has perpetual preferred stock outstanding with a par value of $100....

PREFERRED STOCK RETURNS

Arondale Aeronautics has perpetual preferred stock outstanding with a par value of $100. The stock pays a quarterly dividend of $4, and its current price is $107.

  1. What is its nominal annual rate of return? Do not round your intermediate calculations. Round your answer to two decimal places.
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  2. What is its effective annual rate of return? Do not round your intermediate calculations. Round your answer to two decimal places.
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