13 June, 05:18
Fee Founders has perpetual preferred stock outstanding that sells for $60 a share and pays a dividend of $5 at the end of each year. What is the required rate of return?
13 June, 05:26
The required rate of return of the Preferred stock which the Fee Founders has shall be determined through following mentioned formula:
Applying the data from the given question in the above mentioned formula
r=required rate of return=?
d=dividend paid per share=$5
p=price of preferred stock=$60
r=5/60=8.33%=required rate of return
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» Fee Founders has perpetual preferred stock outstanding that sells for $60 a share and pays a dividend of $5 at the end of each year. What is the required rate of return?