sample exam 1 morning session的第74题，不知道该怎么算。。。不知高手能否指点一下？在p23上

an analyst determisnes that a company has a return on equity of 16% and pays 40% of its earnings in dividends. If the firm last paid a $1.5 dividned and the stock is selling for $40, what is the required rate of return on the stock?

A. 6.4%

B. 9.6%

C. 10.2%

D. 13.7%

ROE=16% 

RR=1- 40%=60% 

g=RR*ROE=60%*16%=9.6%

Current Divident= 1.5*(1+9.6%)=1.644

k=D/P+g=1.644/40+9.6%=13.71%