Will Co Is Expected to Pay a Dividend of $2 Per

Multiple Choice

Will Co. is expected to pay a dividend of $2 per share at the end of year -1(D1) and the dividends are expected to grow at a constant rate of 4% forever. If the current price of the stock is $20 per share calculate the expected return or the cost of equity capital for the firm.

A) 10%
B) 4%
C) 14%
D) None of the above.