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What is the market price of the preferred stock today

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Reference no: EM132443367

Alpha Corporation has outstanding an issue of preferred stock with a par value of $100. It pays an annual dividend equal to 8% of par value. If the required return on Alpha's preferred stock is 6%, and if Alpha pays its next dividend in 1 year, what is the market price of the preferred stock today? Explain why the price would change if the required rate increased to 10%.

Reference no: EM132443367

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