The following financial information is available on Nicole Seamans Company:

Current per share market price$48.00

Current (t = 0) per share dividend$3.50

Expected long-term growth rate5.0%

Seamans can issue new common stock to net the company $44 per share. Determine the cost of internal equity capital using the dividend capitalization model approach. (Compute answer to the nearest 0.1%). (Points : 3)

12.3%

13.4%

13.0%

12.7%