Shares of the common stock of the Final Cut Company are expected to pay a dividend of $2.00 per share next year and their dividend grows at a constant rate of 2.00 percent per year. The current price of Final Cut's stock is $25. Given this information, the required return for Final Cut's stock must be:

a. 0.110

b. 0.120

c. 0.100

d. 0.020