Response to the following questions:
1. The Perpetual Corporation issued shares of preferred at a price of $90 per share. If the dividend is fixed at $9 per share, what is the yield on the preferred shares?
2. Suppose the Everlasting Company has shares of preferred stock outstanding that pay $5 per share and are priced to yield 10%. If the yield on this stock were to change to 8%, what would be the expected effect on the shares' price?
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