Positive Tronics Industries preferred stock has a par value of $100 and pays a dividend of $6.00 per share.It presently sells for $87 per share.What do investors require as a rate of return on this stock? Round off to the nearest .10%.

Question

Quizplus · Accepted Answer

The required rate of return is calculated by dividing the annual dividend by the current price per share: $6 / $87 = 0.0689655, which rounds to 6.9%.

Positive Tronics Industries Preferred Stock Has a Par Value of $100