annual rate of return to preferred stock holders,
Cost of Preferred Stock = Annual Dividend/Price of Preferred Stock
The cost of preferred stock is nothing but the: Multiple Choice Ο annual rate of return...
The cost of preferred stock is nothing but the: Multiple Choice annual rate of return to preferred stock holders. rate of return on an annuity. yield to maturity on bonds. aftertax cost of debt. fixed dividend on preferred stock.
For a large corporation, the annual cost of running business is called the Weighted Average Cost of Capital (or "WACC"). It is the average - or, more precisely, the weighted average of three things: cost of equity, cost of preferred stock, and cost of debt. Weighted Average Cost of Capital (a) Cost of preferred stock is nothing but the rate of return to investors buying common stock shares most recent dividend paid on each share of preferred stock 3 yield...
Afirm's preferred stock pays an annual dividend of $6, and the stock sells for $85. Flotation costs for new issuances of preferred stock are 7% of the stock value. What is the after-tax cost of preferred stock if the firm's tax rate is 33%? (Round your answer to 2 decimal places.) Multiple Choice Ο Ο Ο Ο ο ο ο ο
The correct "cost" for each component of capital is: c) The current dividend rate for preferred and common stock and the after-tax cost of the current yield-to-maturity for debt a) The current dividend rate for common and preferred stock and the coupon interest rate for debt b) The market's required rate of return for preferred stock, common stock and debt, each of which is further reduced by the tax rate d) The market's required return for preferred and common stock...
The cost of preferred stock: Multiple Choice O increases when a firm's tax rate decreases. O is constant over time. O is unaffected by changes in the market price of the stock. O is equal to the stock's dividend yield. increases as the price of the stock increases.
If we assign discount rates to individual projects according to the risk level of each project, it Multiple Choice may cause the company's overall weighted average cost of capital to either increase or decrease over time will prevent the company's overall cost of capital from changing over time will cause the company's overall cost of capital to decrease over time decreases the value of the company over time negates the company's goal of creating the most value for its shareholders...
The dividend on preferred shares is most similar to: Multiple Choice Ο common shares with no growth in dividends. Ο common shares with constant growth in dividends. Ο common shares with variable growth in dividends. Ο a term deposit.
Firm X has a tax rate of 27%. The price of its new preferred stock is $69 and its flotation cost is $200. The cost of new preferred stock is 14%. What is the firm's dividend? (Round your answer to 2 decimal places.) Multiple Choice Ο Ο Ο Ο Multiple Choice o $11.53 o $9.38 o stовз $10.83 o $8.03
Consider the following information for Watson Power Co.: Debt: Common stock: Preferred stock 5,000 8.5 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 104 percent of par; the bonds make semiannual payments. 105,000 shares outstanding, selling for $64 per share; the beta is 1.19. 14,500 shares of 8 percent preferred stock outstanding, currently selling for $106 per share. 9 percent market risk premium andy7.5 percent risk-free rate. Market: Assume the company's tax rate is 34...
Rose has preferred stock selling for 97.2 percent of par that pays a 10.8 percent annual coupon. What would be Rose's component cost of preferred stock? Multiple Choice Ο Ο Ο Ο