A preferred stock has an annual dividend of 835 and the


1. A preferred stock has an annual dividend of $8.35, and the required rate of return is 5%. What is the value of the preferred stock?

$8.35

$16.70

$167.00

$170.60

2. What is the weighted average cost of capital (WACC) used for?

to determine a firm’s taxable income

to evaluate fluctuations in the market

to determine the value of a company’s stock

to evaluate investment possibilities

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Financial Management: A preferred stock has an annual dividend of 835 and the
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