The Cost of Perpetual Preferred Stock Is Found as the Preferred's

question 9

True/False

The cost of perpetual preferred stock is found as the preferred's annual dividend divided by the market price of the preferred stock. No adjustment is needed for taxes because preferred dividends, unlike interest on debt, are not deductable by the issuing firm.

---

Definitions:

Uncertain Variable

A variable with ambiguous or unknown values, often used in contexts requiring decision-making under uncertainty.

Crystal Ball

A forecasting and simulation software tool used for predicting and analyzing future scenarios in business and finance.

Automobile Rental

The service of renting cars for short periods of time, often ranging from a few hours to a few weeks, typically organized with multiple local branches.

Layouts' Constraints

Rules or limitations that govern the arrangement and spacing of elements within a visual or physical design.