The Down and Out Co. just issued a dividend of $2.76 per share on its common stock. The company is expected to maintain a constant 5 percent growth rate in its dividends indefinitely. If the stock sells for $45 a share, what is the company's cost of equity? (Do not round your intermediate calculations.)

rev: 09_20_2012

10.87%

11.13%

6.55%

11.44%

12.01%

*If possible, could you solve it in excel, and show the formulas? Thank you!