1 Preferred stock has a par value of 1000 and a dividend equ

1. Preferred stock has a par value of $1000 and a dividend equal to 13.% of the par value. The stock is selling for $907.00. What discount rate is being used to value the stock? Please show work

Hi,

Please find the detailed answer as follows:

Discount Rate = Annual Dividend/Current Selling Price*100 = (1000*13%)/907*100 = 14.33%

Answer is 14.33%

Thanks.

1. Preferred stock has a par value of $1000 and a dividend equal to 13.% of the par value. The stock is selling for $907.00. What discount rate is being used to

1 Preferred stock has a par value of 1000 and a dividend equ

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