The Down and Out Co$.$ just issued a dividend of $$2\mathrm{.}11$ per share on its common stock. The company is expected to maintain a constant $7$ percent growth rate in its dividends indefinitely. If the stock sells for $$35$ a share, what is the company's cost of equity? $($Do not round your intermediate calculations.$)$

rev: $09\_20\_2012$

Multiple Choice

$13\mathrm{.}03\%$

$14\mathrm{.}12\%$

$12\mathrm{.}78\%$

$6\mathrm{.}65\%$

$13\mathrm{.}45\%$