A Company Issues 500,000 Shares of Preferred Stock for $30

question 71

Multiple Choice

A company issues 500,000 shares of preferred stock for $30 a share. The stock has a fixed annual dividend rate of 5% and a par value of $9 per share. The current price of the preferred stock is $32 a share. Preferred stockholders can anticipate receiving a per share annual dividend of:

• A) 5% of the $9 par value per share.
• B) 5% of the $30 issue price per share.
• C) 5% of the $32 current market price per share.
• D) 5% of the $21 additional paid-in capital per share.

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Definitions:

Systematic Desensitization

A behavioral therapy technique used to reduce phobia-related anxiety through gradual exposure to the fear stimulus combined with relaxation exercises.

Progressive Relaxation

A technique that involves tightening and then relaxing each muscle group in succession to induce physical and mental relaxation.

Psychological Functioning

Encompasses the mental processes and behaviors exhibited by an individual, reflecting their mental health and well-being.

Aaron Beck

Aaron Beck is a psychiatrist widely recognized as the father of cognitive therapy, developing cognitive-behavioral therapy techniques for treating depression and other mental disorders.