Reference no: EM133146970

Question - Hooks Athletics, Inc., has outstanding a preferred stock with a par value of $30 that pays a dividend of $3.00. The preferred stock is redeemable at the option 7. O of the stockholder in 10 years at a price equal to $30. The stock may be called for redemption by the company in 15 years at a price of $31.5. (Any stock that is 8 not redeemed at the end of 10 years can be expected to be called by the company in 15 years.) If you know that investors require a 13 percent pre-tax rate of return on this preferred stock, what is the current market value of this preferred stock?