Homework answers / question archive / A new software company issues preferred shares that pay guaranteed quarterly dividend of $0

A new software company issues preferred shares that pay guaranteed quarterly dividend of $0

Management

Share With

---

A new software company issues preferred shares that pay guaranteed quarterly dividend of $0.50 per share starting 3 months from now. You plan to buy some of the preferred shares. How much would you willing to pay per share if money is worth 4.25% compounded quarterly?

 

 

a) 

$47.06

 

b) 

$56.05

 

c) 

$47.56

 

d) 

$56.45

 

e) 

$50