Edison Corporation paid a dividend of $10 per share on its $100 par preferred stock and $4 per share on its $20 par common stock. The market value of the common stock is $80 per share. Edison's dividend yield is

Question

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The dividend yield is calculated as the annual dividend per share divided by the market price per share. For the common stock, the dividend yield is $4 (dividend) / $80 (market price) = 0.05 or 5%.

Edison Corporation Paid a Dividend of $10 Per Share on Its