The preferred stock of ABC Co. offers a 10.6% rate of return. The stock is currently priced at $80.19 per share. What is the amount of the annual dividend?

A) $6.50
B) $7.00
C) $7.50
D) $8.00
E) $8.50

Preferred Stock

Preferred stock is a type of equity that typically gives its holders preference over common stockholders in terms of dividends and claims on assets in the event of liquidation, but usually does not carry voting rights.

Rate of Return

The financial outcome, whether positive or negative, on an investment over a set duration, highlighted as a percentage of the investment's initial expenditure.

Dividend

Earnings handed out by a corporation to its investors, generally as a profit distribution.