What Is the Required Rate of Return to the Investor

question 99

Multiple Choice

What is the required rate of return to the investor who is willing to purchase a Duke Power preferred stock with a $8.70 dividend, a par value of $100, and a current market price of $87?

• A) 10.7%
• B) 8.7%
• C) 9.4%
• D) 10.0%

---

Definitions:

Virtuous Cycle

A sequence of events that reinforce itself through a feedback loop, resulting in positive outcomes.

Social Responsibility

The obligation of individuals and companies to act in a way that benefits society at large, often involving environmental sustainability, ethical business practices, and community development.

Corporate Performance

Measures the efficiency and effectiveness of a company in achieving its goals, often evaluated through financial metrics, operational productivity, and market position.

Ethical Leadership

A leadership approach that is guided by respecting ethical principles and values in decision making and actions.