Problem 2: "Consider a preferred stock with par value P4,000 per share, 8% dividend rate paid quarterly, and a life of 15 years. If the required annual rate of returns is 10%, what must be the price per share of the stock? 6. What is the payment interval in the problem? a. Every 2 months 7. Compute for the smount of dividend per quarter a. P120 b. Every 3 months c. Every 4 months d. Every 6 months b. P100 c. P80 d. P60 8. What is the present value of the dividend? a. P2,472.69 b. P2,742.69 c. P7,442.69 d. P7,424.69
Problem 2: "Consider a preferred stock with par value P4,000 per share, 8% dividend rate paid quarterly, and a life of 15 years. If the required annual rate of returns is 10%, what must be the price per share of the stock? 6. What is the payment interval in the problem? a. Every 2 months 7. Compute for the smount of dividend per quarter a. P120 b. Every 3 months c. Every 4 months d. Every 6 months b. P100 c. P80 d. P60 8. What is the present value of the dividend? a. P2,472.69 b. P2,742.69 c. P7,442.69 d. P7,424.69
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Problem 2: "Consider a preferred stock with par value P4,000 per share, 8% dividend rate paid quarterly, and a life of 15
years. If the required annual rate of returns is 10%, what must be the price per share of the stock?
6. What is the payment interval in the problem?
a. Every 2 months
7. Compute for the amount of dividend per quarter
a. P120
8. What is the present value of the dividend?
a. P2,472.69
9. Give the value per share of the stock in 15 years.
a. P2,742.69
10. Determine the present value per share of the stock in 15
a. P909.13
b. Every 3 months
c. Every 4 months
d. Every 6 months
b. P100
C. P80
d. P60
b. P2,742.69
c. P7,442.69
d. P7,424.69
b. P4,000.00
c. P400
d. P200
years.
b. P990.13
c. P1009.13
d. P1090.13
11. What must be the price per share of the stock?
a. P8331.82
b. P8313.82
c. P3381.82
d. P3831.82
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