X-Tech Company issued preferre stock many years ago. It carries a fixed dividend of $1 per...
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X-Tech Company issued preferre stock many years ago. It carries a fixed dividend of $1 per share. With the passage of time, yields have changed from the original 7 percent to 12 percent (yleld is the same as required rate of return). a. What wes the original issue price? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Original issue price b. What is the current value of this preferred stock? (Do not round intermediate calculations. Round your answer to 2 decimal ploces.) Current value c. If the yield on the Standard & Poor's Preferred Stock Index declines, how will the price of the preferred stock be affected? O The price of preferred stock will increase. O The price of preferred stock will decrease. X-Tech Company issued preferre stock many years ago. It carries a fixed dividend of $1 per share. With the passage of time, yields have changed from the original 7 percent to 12 percent (yleld is the same as required rate of return). a. What wes the original issue price? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Original issue price b. What is the current value of this preferred stock? (Do not round intermediate calculations. Round your answer to 2 decimal ploces.) Current value c. If the yield on the Standard & Poor's Preferred Stock Index declines, how will the price of the preferred stock be affected? O The price of preferred stock will increase. O The price of preferred stock will decrease.
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Price of the preferred share Preferred dividend per share Yield or requir... View the full answer
Related Book For
Foundations of Financial Management
ISBN: 978-1259194078
15th edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
Posted Date:
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