The Required Rate of Return on TKF Preferred Has Fallen

question 72

Multiple Choice

The required rate of return on TKF preferred has fallen from 5.75% at the time of issue to the present rate of 5%. The stock now sells for $115. What was the original price?

• A) $75.61
• B) $132.25
• C) $114
• D) $100

---

Definitions:

Ethical Lapses

Instances where individuals or organizations fail to act in accordance with their moral or ethical standards.

Civil Prosecution

A legal process initiated by a private party, rather than the state, to seek remedy for a wrong that is believed to have been done to them.

Enron

Enron was a U.S.-based energy company that collapsed after an accounting fraud scandal, becoming a symbol of corporate fraud and corruption.

Financial Statement

Summaries that offer a comprehensive view of a firm's financial status, featuring the balance sheet, income statement, and statement of cash flows.