A share is trading at $10.50. It recently paid a dividend of 50c. Dividends are expected to grow by 2% per annum. What is the required rate of return on this share according to the dividend discount model?

(a) 6.56% pa.

(b) 6.76% pa.

(c) 6.86% pa.

(d) 6.89% pa.

(e) 6.99% pa.