If 1) the expected return for Litchfield Design stock is 10.86 percent; 2) the dividend is expected to be 2.04 dollars in 2 year(s), 5.35 dollars in 4 years, and 7.14 dollars in 7 years; and 3) after the dividend is paid in 7 years, the dividend is expected to grow by 5.34 percent per year forever, then what is the current price of the stock?  If no expected dividend is mentioned for a given year, assume the expected dividend is $0 for that year.

Answer rating: 100% (QA)

To calculate the current price of the stock we can use the dividend discount model DDM which values ... View the full answer