Teal plc has a market capitalisation of $30 million and forecast post-tax profits for the forthcoming year

of $10 million. The company has an issued share capital of $1 million, which is made up of $050 ordinary

shares. The policy of Teal plc is to maintain a constant dividend cover of 25 times. Dividends are

expected to increase by 5% per annum for the foreseeable future.

Which of the following is the expected rate of return from the ordinary shares?

A 83%

B 183%

C 217%

D 317%.