Franklin Corporation is expected to pay a dividend of $1.25 per share at the end of the year (D1 = $1.25). The stock sells for $31.00 per share, and its required rate of return is 10.5%. The dividend is expected to grow at some constant rate, g, forever. What is the equilibrium expected growth rate? Select the correct answer.

a. 6.77%

b. 6.62%

c. 6.92%

d. 6.47%

e. 6.32%