Answer:
5.08%
Explanation:
using the Gordon growth model we can calculate the expected growth rate:
current stock price = dividend / (required rate of return - growth rate)
$54.20 = $3.75 / (12% - g)
12% - g = $3.75 / $54.20
12% - g = 6.92%
g = 12% - 6.92% = 5.08%
