CMT,IncHas an Issue of Preferred Stock Whose Par Value Is

question 23

Multiple Choice

CMT,Inc.has an issue of preferred stock whose par value is $500.The preferred stock pays a 4.5% dividend.If investors require a 5.5% rate of return for these shares,what price should the preferred stock sell for?

• A) $611.11
• B) $508.33
• C) $409.09
• D) $81.82

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Definitions:

Workforce Reduction

The process of decreasing a company's employee count through methods such as layoffs, retirements, or terminations, often for cost-cutting measures or organizational restructuring.

Unwritten Employment Contract

An implied agreement between an employer and employee that is not formally documented but is understood and accepted by both parties.

Downsizing

A corporate strategy involving the reduction of a company's workforce to improve efficiency or adapt to new market conditions.

Short-term Cost Adjustment

Immediate actions taken to modify expenses in response to financial pressures or budget constraints.