Munger Corp. has preferred stock outstanding that will pay an annual dividend of $5.20 per share...

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Munger Corp. has preferred stock outstanding that will pay an annual dividend of $5.20 per share...

Munger Corp. has preferred stock outstanding that will pay an annual dividend of $5.20 per share (indefinately) with the first dividend exactly 12 years from today. If the required return is 9.3 percent, what is the current price of Munger Corp. stock?

Multiple Choice

$19.23
$21.02
$87.53
$81.08
$55.91

business finance

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Answer 1

Answer #1

Price (P11) Annual Dividend/Required Return 5.20/0.093 55.91 PO P8/(1+Required Return)^11 55.91/(1+0.093)^11 21.02!

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Answer 2

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Munger Corp. has preferred stock outstanding that will pay an annual dividend of $5.20 per share...

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Munger Corp. has preferred stock outstanding that will pay an annual dividend of $5.20 per share...

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Munger Corp. has preferred stock outstanding that will pay an annual dividend of $5.20 per share...