Question: Which statement is true? 1- Preferred stock is valued using the perpetuity present value formula. 2- An increase in the market value of preferred stock

Which statement is true?

1- Preferred stock is valued using the perpetuity present value formula.

2- An increase in the market value of preferred stock will increase a firm's weighted average cost of capital.

3- The cost of preferred stock remains constant from year to year.

4- Preferred stock is generally the cheapest source of capital for a firm.

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