Traditional Bank Has an Issue of Preferred Stock with a $4.80

question 76

Multiple Choice

Traditional Bank has an issue of preferred stock with a $4.80 stated dividend that just sold for $80 a share.What is the bank's cost of preferred stock?

• A)5.91 percent
• B)6.00 percent
• C)6.23 percent
• D)6.47 percent
• E)7.32 percent

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Definitions:

Second Law

Presumably referencing the Second Law of Thermodynamics, which states that the entropy of any isolated system always increases.

Energy Disperses

A concept in thermodynamics and statistical mechanics where energy spreads out from a localized state to a more widespread and even distribution.

Desertification

Conversion of grassland or woodland to desert.