Required rate of return on preferred stock

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Reference no: EM13948798

What is the maximum price you would pay for the following preferred stocks given that your required rate of return on preferred stock is 7%?

A. CCA Inc. pays dividends of $8 annually and has a par value of $100.

B. NCE Inc. pays dividends of $8 annually and has a par value of $100 with a mandatory retirement after 20 years.

Reference no: EM13948798

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