The Current Yield on Alpha's Common Stock Is 5

Multiple Choice

The current yield on Alpha's common stock is 5.2%. The company just paid a $2.10 dividend. The rumor is that the dividend will be $2.3 next year. The dividend growth rate is expected to remain constant at the current level. What is the required rate of return on Alpha's stock?

A) 10.70%
B) 12.31%
C) 18.29%
D) 20.01%
E) 24.21%