Which one of the following is probably the best argument in favor of a stock split?...
Which one of the following is probably the best argument in favor of a stock split?
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to lower the current stock price to its normal trading range |
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to provide additional shares to all its shareholders |
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to avoid delisting |
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to increase the value of the firm |
Homework Answers
Generally the stock price increase over a period of time, and after a long number of years, the stock price might become very high, thereby reducing the liquidity of the stock. Because of this the trading of the stock reduces.
Hence, stock splits are done (a) to lower the current stock price to its normal trading range
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Which one of the following is probably the best argument in
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The primary purpose of a stock split is to A. indicate the firm's desire to retain...
The primary purpose of a stock split is to A. indicate the firm's desire to retain funds. B. increase the investor's overall wealth. C. reduce the threat of a takeover by creating more shares. D. bring the stock price to a lower trading range.
Which one of the following is correct concerning the effects of a reverse stock split? Select...
Which one of the following is correct concerning the effects of a reverse stock split? Select one: O a. The market price of the stock will decrease. b. The number of shares outstanding will increase. O c. The market value of the equity will remain constant. O d. The par value of the stock will increase. e. The balance in the common stock account will increase.
Question1 Coombs Corp. declared a two-for-one stock split. Solly Fogarty owned 500 shares of Coombs that...
Question1 Coombs Corp. declared a two-for-one stock split. Solly Fogarty owned 500 shares of Coombs that were trading for $20 each before the split. Which of the following is ikely to be true after the spl? The market price per share will drop by 50%. O The total market value of Solly's shares will double. The number of shares Soby owns wil increase by SO. The market price per share nli increase by 100%.
1.... Why might a corporation want to split its stock? Select one: A. To avoid sending...
1.... Why might a corporation want to split its stock? Select one: A. To avoid sending a message to current and prospective investors B. To lower the stock price to a more popular trading range C. To assist in the takeover of another firm D. None of these answers is correct 2.... When it comes to making cash dividend payments, most U.S. corporations: Select one: A. Desire to frequently change the amount of dividends being paid B. Prefer decreasing dividend...
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Which of the following statements about a 2-for-1 stock split is not true? A shareholder with...
Which of the following statements about a 2-for-1 stock split is not true? A shareholder with 200 shares before the split owns 400 shares after the split. Legal capital per share is reduced to half of what it was before the split. Total share capital increases. The market value of the shares will probably decrease.
Which of the following statement is correct regarding dividends? A) A stock split always increases the...
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A stock has a normal trading range of $22 to $30. The stock is currently selling at $141 a share. It would be common for a firm in this situation to: Select one: O a. Issue a one-time special dividend. O b. Repurchase outstanding shares by issuing debt securities. O c. Increase the number of outstanding shares via a stock split. d. Do a reverse stock split to lower the market price of the stock. e. Issue a liquidating dividend...
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Question1 Coombs Corp. declared a two-for-one stock split. Solly Fogarty owned 500 shares of Coombs that were trading for $20 each before the split. Which of the following is ikely to be true after the spl? The market price per share will drop by 50%. O The total market value of Solly's shares will double. The number of shares Soby owns wil increase by SO. The market price per share nli increase by 100%.
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