Horizon Communications Stock Pays a Fixed Annual Dividend of Of $3.00.Because

Horizon Communications stock pays a fixed annual dividend of of $3.00.Because of lower inflation,the market's required yield on this preferred stock has gone from 12% to 10%.As a result:

A) Horizon's dividend decreased by 6 cents.
B) The value of Horizon's preferred increased by $3.00.
C) The value of Horizon's preferred decreased by $5.00.
D) The value of Horizon's preferred increased by $5.00.

Correct Answer:

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