Repeat the previous problem but assume that comparable yields are
Repeat the previous problem but assume that comparable yields are 10 percent.
Previous problem
What should be the prices of the following preferred stocks if comparable securities yield 7 percent? Why are the valuations different?
a. MN Inc., $8 preferred ($100 par)
b. CH Inc., $8 preferred ($100 par) with mandatory retirement after
20 years
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