Lionel Tricycles has a beta of 0.88 and an expected dividend growth rate of 4.00% per year. The T-bill rate is 4.00%, and the T-bond rate is 5.25%. The annual return on the stock market during the past 4 years was 10.25%. Investors expect the average annual future return on the market to be 11.50%. Using the SML, what is Lionel's required rate of return?

Select one:

a. 11.02%

b. 10.75%

c. 11.58%

d. 11.29%

e. 10.48%