Eyes.com has a new issue of preferred stock it calls 2 dividend will not be paid until 20 years from today. The What is the price of the stock 19 years from today? Note: Do not round intermediate calculations and rou

Eyes.com has a new issue of preferred stock it calls 2 dividend will not be paid until 20 years from today. The What is the price of the stock 19 years from today? Note: Do not round intermediate calculations and rou

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

what is the price of the stock today?

the price in 19 years is 275.86

E-Eyes.com has a new issue of preferred stock it calls 20/20 preferred. The stock will pay a $20 dividend per year, but the first
dividend will not be paid until 20 years from today. The required return on the stock is 7.25 percent.
What is the price of the stock 19 years from today?
Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
Answer is complete and correct.
Price in 19 years $275.86
What is the price of the stock today?
Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
Answer is complete but not entirely correct.
Current stock
Invice
207,83

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