Primula Corporation $($PRM$)$ just paid a dividend of $$3\mathrm{.}25.$ Analysts expect that

dividend to grow over the next $5$ years at $5\%$ per year. PRM$$s cost of equity is $8\%.$ After $5$

years, PRM intends to set a fixed $($i$.$e$.,$ unchanging$)$ dividend at $$4\mathrm{.}50$ and expects the internal

growth rate to decline to $3\%$ as a result.

$$ What is the value of the stock today?

$$ Please draw a clearly marked number line.

$$ Do you have any reservations about using the Dividend Discount Model $($DDM$)$ for

pricing a stock? If so$,$ why?