A preferred stock pays an annual dividend of $3.20. What is one share of this stock worth today if the rate of return is 11.75 percent?
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- You own a portfolio which isevenly distributed among U.S. Treasury bills, Stock A with a beta of .84, stock B with a beta of 1.48, and stock C, whichis equally as risky as the market. The risk-free rate of return is 4 percent and the expected return on the
- The expected return rate of A stock is 8%, the risk-free return rate is 4%, and the variance of A stock is 4%, then the Sharpe ratio of A stock is A: 0.2 B: 1 C: 2 D: 0.4
- One year ago, you invested $1,800. Today it is worth $1,924.62. What rate of interest did you earn? A: 6.59 percent B: 6.67 percent C: 6.88 percent D: 6.92 percent E: 7.01 percent
- The growth rate in dividends is a function of two ratios. They are A: ROA and ROE. B: dividend yield and growth rate in stock price. C: ROE and the plowback ratio. D: book value per share and EPS.
- Which of the following statements related to preferred stock are correct? I. Preferred stock pays a constant dividend. II. Preferred stock is generally the cheapest source of capital for a firm. III. A decrease in the market value of preferred stock will increase a firm's weighted average cost of capital. IV. An increase in the rating of a preferred stock will increase the cost of preferred. A: II and III only B: I and IV only C: I and III only D: II and IV only E: I, III, and IV only