Suppose a preferred share pays perpetual quarterly dividends of $0.25 ($1.00 per annum) and has a per annum dividend yield (discount rate) of 6 percent. What is the fair value of this preferred share? Select one: a. $14.67 b. $15.33 Oc. $16.00 O d. $16.67

Essentials Of Investments
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Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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Suppose a preferred share pays perpetual quarterly dividends of $0.25 ($1.00 per annum) and has a per annum
dividend yield (discount rate) of 6 percent. What is the fair value of this preferred share?
Select one:
a. $14.67
O b. $15.33
C.
$16.00
O d. $16.67
Transcribed Image Text:Suppose a preferred share pays perpetual quarterly dividends of $0.25 ($1.00 per annum) and has a per annum dividend yield (discount rate) of 6 percent. What is the fair value of this preferred share? Select one: a. $14.67 O b. $15.33 C. $16.00 O d. $16.67
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