What is the rate of return for this preferred stock

Assignment Help Financial Management
Reference no: EM131513364

1. If a bond provides a real rate of return of 2.89 percent at a time when inflation is 3.21 percent, what is the nominal rate of return on the bond?

 

2. A preferred stock pays a dividend of $2.50 per year. It is currently priced at $19.55. What is the rate of return for this preferred stock?

Reference no: EM131513364

Questions Cloud

What role it plays in cost control : Explain what a variance is, why it is important, and what role it plays in cost control.
Calculate the force in the brace : The three bay, one-story frame consists of beams pin connected to columns and column bases pinned to the foundation in Figure. The diagonal brace member CH.
Present values of all the projects incremental cash inflows : Add together the present values of all the project’s incremental cash inflows
What is the cost of each spread : What is the cost of each spread?
What is the rate of return for this preferred stock : what is the nominal rate of return on the bond? What is the rate of return for this preferred stock?
Determine the forces in the hinges and the reactions : The multispan girder in Figure has two shear plate connections that act as hinges at C and D. The midspan girder CD is simply supported on the cantilevered.
Calculate operating break-even point in both units-dollars : Calculate the operating break-even point in both units and dollars.
Determine the appropriate strategy : Determine the appropriate strategy.
The dollar duration and the convexity of my portfolio : What are the current value, the dollar duration and the convexity of my portfolio? Interpret the dollar duration and the convexity numbers

Reviews

Write a Review

Financial Management Questions & Answers

  Using the straight line method to salvage value

Capital Foods purchased an oven 5 years ago for $45,000. The oven is being depreciated over its estimated 10 year life using the straight line method to a salvage value of $5,000. Capital is planning to replace the oven with a more automated one that..

  The firm is considering changing its production technology

The Generic Publications Textbook Company sells all of its books for $100 per book, and it currently costs $50 in variable costs to produce each text. The fixed costs, which include depreciation and amortization for the firm, are currently $2 million..

  Describes the IRR decision criterion

Which of the statements below describes the IRR decision criterion?

  After supply and demand for the japanese yen

The inflation rate in the U.S. is 4%, while the inflation rate in Japan is 1.5%. The current exchange rate for the Japanese yen (¥) is $0.0080. After supply and demand for the Japanese yen has adjusted according to purchasing power parity, the new ex..

  Compute the return on stockholders equity

Pacific Fixtures lists the following accounts as part of its balance sheet. Compute the return on stockholders’ equity if the company has sales of $20 million and the following net profit margin:

  Maturity pays coupon-market required rate of return

A $1,000 corporate bond with 10 years to maturity pays a coupon of 8% (semi-annual) and the market required rate of return is a) 7.2% and b) 10%. What is the current selling price for a) and b)?

  Define the general contracts and general scope of work

Define the following terms: General Contracts · General scope of work · Contract Intent · Contract Indication · Reasonable review · Patent errors · Change clause(order) · Pass-through clause Contract Bonds and Insurance · Bid Bond · Performance Bond ..

  A spread is an investment strategy

A SPREAD is an investment strategy that involves the simultaneously buying and selling equal number of options on the same underlying security but with different strike prices

  Traditional land lines and have gone completely wireless

What is Apple’s stock (Iphones & Ipads) selling for now and how does it relate to their stock price 15 years ago? Would you be happier with a stock portfolio containing Apple and Motorola as opposed to Sprint and BellSouth?  How many of us have aband..

  What is the feature of a corporate bond

What is the feature of a corporate bond that protects the purchaser from moral hazard on the part of the borrower?

  What would be your total real return on the investment

You bought one of Bergen Manufacturing Co.’s 8.5 percent coupon bonds one year ago for $1,064. These bonds make annual payments and mature eleven years from now. Suppose you decide to sell your bonds today when the required return on the bonds is 6 p..

  What will be the percentage change in the bond price

A bond has a coupon rate of 8 percent, 7 years to maturity, semiannual interest payments, and a YTM of 7 percent. If interest rates suddenly rise by 2 percent, what will be the percentage change in the bond price?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd