AlwaysAround Co

question 58

Multiple Choice

AlwaysAround Co.has just issued a preferred stock that pays an annual $4 dividend.The first dividend will be received one year from today.If the required rate of return on this stock is 5%,then what is the price of the stock?

• A) $3.81
• B) $4.20
• C) $80.00
• D) none of the above

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Definitions:

Ultimate Consumer

The end-user or actual buyer who uses or consumes a product or service for personal use, not for resale.

Broker

A person or firm that acts as an intermediary between buyers and sellers, usually for a fee or commission.

Business Consultants

Professionals who provide expert advice in a particular area of business, such as management, operations, or marketing, to help organizations improve performance.

Index

A statistical measure or indicator often used in finance to represent the performance of a group of assets or a sector of the market.