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IVY Has Preferred Stock Selling for 98 Percent of Par

Question 35

Multiple Choice

IVY has preferred stock selling for 98 percent of par that pays a 7 percent annual coupon. What would be IVY's component cost of preferred stock?


A) 6.86 percent
B) 7.00 percent
C) 7.14 percent
D) 14.00 percent

Correct Answer:

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