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blue panda has preferred stock that pays a dividend of $8.00 per share and sells for $100 per share. it is considering issuing new shares of preferred stock. these new shares incur an underwriting (or flotation) cost of 2.30%. How much will Blue Panda pay to the underwriter on a per-share basis?

Respuesta :

According to the scenario, computation of the given data are as follows:

Dividend paid = $8 per share

Selling price = $100 per share

Underwriting cost = 2.30%

We can calculate the amount pay to the underwriter by using following formula:-

Shares are fractional ownership interests in a corporation. For some businesses, shares are a type of financial instrument that allows for the equitable distribution of any declared residual profits in the form of dividends. A stock with no dividend payments does not distribute its income to its shareholders.

Blue panda Pay to the Underwriter = Selling Price Per Share × Underwriter Cost

= $100 × 2.30%

= $2.3 per Share

To know more about shares, refer:

https://brainly.com/question/16242949

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