The National Bank of Columbia has issued perpetual preferred stock with a $100 par value. The bank pays a quarterly dividend of $1.40 on this stock. What is the current price of this preferred stock given a required rate of return of 8.5 percent?

The correct answer is $65.88.

Explanation:

According to the scenario, computation of the given data are as follows:

Par value of preferred stock = $100

Dividend (quarterly) = $1.40

Rate of return = 8.5%

Rate of return (quarterly) = 8.5% ÷ 4 = 2.125%

So, we can calculate the current price by using following formula:

Current price = Dividend ÷ rate of return

By putting the value, we get

= $1.40 ÷ 2.125%

= $65.88

For 15 to 20, change the equation from y=mx+b into mx-y=-b
Example: 15) y=-5x+2 into -2=-5x-y or 2=5x+y
For 21-29, the numbers in the parenthesis are coordinates (x, y) so uh the equation y=mx+b plug in the m that is given and x and y and then solve for b to complete the equation
Ex: 21) (-8,3) m=2
Y=mx+b
3=2(3)+b
3=6+b
-3=b
So y=2x-3
Do the same to the others