What is the current price of preferred shares

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Q1. Pharoah Industries common stock has a beta of 1.7. If the market risk-free rate is 5.4 percent and the expected return on the market is 8.4 percent, what is Pharoah's cost of common stock?

Q2. Crane Hand Trucks has a preferred share issue outstanding that pays a dividend of $1.30 per year. The current cost of preferred equity for Crane is 10.10 percent. Crane issues additional preferred shares that pay exactly the same dividend and the investment banker retains 5.60 percent of the sale price. What is the current price of preferred shares?

Reference no: EM133015845

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