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7 December, 16:15

Grill Works and More has 7 percent preferred stock outstanding that is currently selling for $49 a share. The market rate of return is 14 percent and the firm's tax rate is 37 percent. What is the firm's cost of preferred stock?

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  1. 7 December, 16:55
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    Answer: 14.29%

    Explanation:

    percentRp = (0.07 * $100) / $49 = 14.29
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