Epo Pharmaceuticals Inc. has an issue of preferred stock outstanding that has a required rate of return of 9% and pays $6 annual dividends. If the preferred share were issued 3 years ago, what is the current price per share?
A) $51.48
B) $66.67
C) $86.34
D) There is not enough information to answer this question.
B
Explanation: B) PV = PMT/r = $6/.09 = $66.67.
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