West Coast Ltd. wants to issue preferred stock that pays an annual dividend of $6.80 a share. The company has determined that stocks with similar characteristics provide a 12.25 percent rate of return. What should the offer price be

The offer price will be $55.51

Explanation:

The constant cash flow over a indefinite period of time is the perpetuity. The dividend payment on the preferred is also considered as perpetuity because it pays the constant amount of dividend and there is no time limit for the payment.

Value of the preferred share can be determine by following formula

Value of Perpetuity / Cash flow / required rate of return

Price of share = Dividend Payment / Rate of return

Price of share = $6.8 / 12.25% = $55.51

the correct answer option is b. a single paragraph.

explanation:

when you are thinking about paragraph​ topics, you should always choose a subject that can be adequately addressed in a single paragraph.

a paragraph is a piece of writing consisting of a few sentences that deal with a single theme. it has only a single idea that the paragraph revolves around and talks about.

so a paragraph topic must be chosen wisely where a single idea can be communicated in a single paragraph.