Problem on stock valuation

Reference no: EM1354179

Suppose Toyota has nonmaturing (perpetual) preferred stock outstanding that pays a $1.00 quarterly dividend and has a required return of 12% APR (3% per quarter). What is the stock worth?

If you use the spreadsheet method shown in the workshop, assume "perpetual" means 63 years (due to a limitation in Excel). If you use the Excel formula, assume payments are made at the end of the period.

Reference no: EM1354179

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