Answer: Burkhardt Corp.'s current share price is $69.47.
The current share price of a stock can be viewed as the present value of its expected dividends.
In this case, the stock price will be the sum of the discounted value of the dividends over each of the next eight years.
Mathematically we can express this as:
[tex]\mathbf{Current Price = \frac{D}{(1+r)^{1}}+\frac{D}{(1+r)^{2}}+\frac{D}{(1+r)^{3}}......+\frac{D}{(1+r)^{n}}}[/tex]
Substituting the values we get,
[tex]Current Price = \frac{13.5}{1.11^1}+\frac{13.5}{1.11^2}+\frac{13.5}{1.11^3}+\frac{13.5}{1.11^4}+\frac{13.5}{1.11^5}+\frac{13.5}{1.11^6}+\frac{13.5}{1.11^7}+\frac{13.5}{1.11^8}[/tex]
Solving the above equation we get,
[tex]\mathbf{Current Price = 69.47}[/tex]
