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A company has an ROE of 12% and payouts 63% of its earnings as dividends. It is planning to pay a $3.10 dividend next year

A company has an ROE of 12% and payouts 63% of its earnings as dividends. It is planning to pay a $3.10 dividend next year with a current stock price of $40. What is the company's dividend growth rate? Express your answer as a percentage and round to two decimals.

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