QUESTION 17A company has preferred stock that pays a constant $2.8 per share dividend. If the stock's required return is 8.9%, how much should you be willing to pay for a share of thestock? Round your final answer to two decimal places (don't round intermediate calculations).Click Save and Submit to save and submit. Click Save All Answers to save all answers.

Annual dividend = $ 2.8 Required return = 8.9%

Answered: A company has preferred stock that pays…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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A company has preferred stock that pays a constant $2.8 per share dividend. If the stock's required return is 8.9%, how much should you be willing to pay for a share of the stock? Round your final answer to two decimal places (don't round intermediate calculations).