To calculate the approximate current yield (or cost) of the preferred stock, we use the following formula:

$\text{Current Yield} = \frac{\text{Annual Dividend}}{\text{Current Price}} \times 100$

Step-by-Step Calculation:

1. Annual Dividend:
   The preferred stock was originally issued at a par value of $100 with a yield of 6%.
   The annual dividend is:
   $\text{Annual Dividend} = 6\% \times 100 = 6$

2. Current Price:
   The stock is now selling for $102.

3. Current Yield Calculation:
   Substitute the values into the formula:
   $\text{Current Yield} = \frac{6}{102} \times 100$

   Simplify:
   $\text{Current Yield} = 5.88\%$

Answer:

The approximate current yield is 5.9% (closest option).

Do you need further clarification on this calculation or concept?

Here are 5 related questions to explore further:

1. How does the par value influence preferred stock calculations?
2. How do market price changes impact the yield of preferred stock?
3. What is the relationship between dividends and cost of preferred stock?
4. How does flotation cost affect the cost of issuing preferred stock?
5. What is the difference between yield and required return for preferred stock?

Tip: The yield of preferred stock reflects the investor's return based on the current price, not the par value. Always use the market price for yield calculations.