Confectioners' Corner Wants to Offer Some Preferred Stock That Pays

question 253

Multiple Choice

Confectioners' Corner wants to offer some preferred stock that pays an annual dividend of $4.50 a share. The company has determined that stocks with similar characteristics provide an 11% rate of return. What price should Confectioner's expect to receive per share for this stock offering?

• A) $38.87
• B) $40.54
• C) $40.91
• D) $45.50
• E) $49.50

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