What is the required return on equity (r) if a stock is trading for $32.50 per share in the secondary market and is expected to pay a dividend of $2.50 one year from today (this means that DIV₁ = $2.50). Assume this stock is a constant growth stock where the growth rate is 6.5 percent (i.e., g = 0.065)? HINT: The required return on equity (r) is comprised of the dividend yield plus the capital gains yield (g).