Calculate the nominal rate of return on a perpetual preferred stock with a par value of $200, a dividend of 9% of par value, and a current market price of $100.

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter8: Basic Stock Valuation
Section: Chapter Questions
Problem 10P
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  1. Calculate the nominal rate of return on a perpetual preferred stock with a par value of $200, a dividend of 9% of par value, and a current market price of $100.
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