Question

Skyler Industries's preferred stock currently sells for $41 per share. The stock pays an annual dividend of $2.94 per share. The cost of preferred stock, Rp, is ____%. Round your final answer to 2 decimal places (example: enter 12.34 for 12.34%), but do not round any intermediate work in the process. [Note: Correct answer feedback may show more than 2 decimal places, but you should still follow instructions above for entering your answers.] Margin of error for correct responses: +/- .03.

Answer 1

Ans 7.17%

cost of preferred stock = Dividend / Price of Stock * 100

                                        = 2.94 / 41 * 100

                                         = 7.17%