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Estimating Stock Value Using Dividend Discount Model with Increasing Perpetuity

Kellogg pays $2.50 in annual per share dividends to its common stockholders, and its recent stock price was $88.00. Assume that Kellogg's cost of equity capital is 5.0%.

Estimate Kellogg's expected growth rate based on its recent stock price using the dividend discount model with increasing perpetuity.

Do not round until your final answer. Round answer to one decimal place (ex: 0.0245 = 2.5%)

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