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Food Inc. has failed to sell any type of debt. The company has 40,000 common shares outstanding, and 10,000 preferred shares outstanding. The preferred shares

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Food Inc. has failed to sell any type of debt. The company has 40,000 common shares outstanding, and 10,000 preferred shares outstanding. The preferred shares pay $2.00 per year in dividends and are traded at $40 per share. The last dividend paid to common stockholders was $5 per share and the company expects to grow at 2% forever. The current price of the common stock is $80. What is the expected return on the common stock? 6.678% 10.001% 7.516% 8.375% 9.256%

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