18%
20%
22%
24%
Answer is Right!
Answer is Wrong!
The correct answer is A. 18%.
The required rate of return is the minimum return that an investor expects to earn on an investment. It is calculated by dividing the preferred dividend by the value of the stock. In this case, the preferred dividend is Rs 60 and the value of the stock is Rs 300. Therefore, the required rate of return is 18%.
Option B is incorrect because 20% is greater than the required rate of return. Option C is incorrect because 22% is greater than the required rate of return. Option D is incorrect because 24% is greater than the required rate of return.