#22

Mature Corp. has stock which costs $42.00 per share. The company expects to pay a dividend of $2.00 per share this coming year and the dividands are expected to grow at some constant grotwth rate thereafter. The company's cost of equity capital is 12%. What is the expected annual growth rate of the company's dividends?

A. 10.14%

8. 7.24%

c. 13.03%

D. 4.34%