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This year,a firm paid an annual dividend of $2.50 per share. The current share price is $34. If dividends are forecast to increase at a

This year,a firm paid an annual dividend of $2.50 per share. The current share price is $34. If dividends are forecast to increase at a constant 2% annual rate indefinitely, then what is the required return on equity?

a. 7.52%

b. 2.075%

c. 9.50%

d.9.35%

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