a) “A stock repurchase carries information content”. What type of information has been referred to in this statement? What impact is likely to have on the stock price of a firm? (Max 50 words) b) The Olive Vase has 56,000 shares of stock outstanding with a par value of $1 per share and a market value of $11 a share. The company just announced a 3-for-4 reverse stock split. Currently, you own 500 shares of this stock. What is the total value of your stock? What will the total value of your shares be after the reverse stock split?
a) “A stock repurchase carries information content”. What type of information has been referred to in this statement? What impact is likely to have on the stock price of a firm? (Max 50 words) b) The Olive Vase has 56,000 shares of stock outstanding with a par value of $1 per share and a market value of $11 a share. The company just announced a 3-for-4 reverse stock split. Currently, you own 500 shares of this stock. What is the total value of your stock? What will the total value of your shares be after the reverse stock split?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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a) “A stock repurchase carries information content”. What type of
information has been referred to in this statement? What impact is
likely to have on the stock price of a firm? (Max 50 words)
b) The Olive Vase has 56,000 shares of stock outstanding with a par value
of $1 per share and a market value of $11 a share. The company just
announced a 3-for-4 reverse stock split. Currently, you own 500 shares
of this stock. What is the total value of your stock? What will the
total value of your shares be after the reverse stock split?
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