Companies sometimes consider stock splits to bring down the price so that the stock attracts more purchases. Consider the following case: Tolbotics Inc. currently has 15,000 shares of common stock outstanding. Its management believes that its current stock price of $90 per share is too high. The company is planning to conduct stock splits in the ratio of 4 for 1 as described in the animation. If Tolbotics Inc. declares a 4-for-1 stock split, the price of the company’s stock after the split, assuming that the total value of the firm’s stock remains the same after the split, will be ________ Fuzzy Muffin Manufacturing Company is one of Tolbotics’s leading competitors. Fuzzy Muffin’s market intelligence research team shares Tolbotics’s plans of announcing a stock split, influencing the distribution policymakers. Consequently, executives at Fuzzy Muffin decide to offer stock dividends to its shareholders. Fuzzy Muffin currently has 1,900,000 shares of common stock outstanding. If the firm pays a 4% stock dividend, what will be the total number of shares outstanding after the stock dividend? 1,976,000 shares 2,173,600 shares 2,272,400 shares 2,371,200 shares
Companies sometimes consider stock splits to bring down the price so that the stock attracts more purchases. Consider the following case: Tolbotics Inc. currently has 15,000 shares of common stock outstanding. Its management believes that its current stock price of $90 per share is too high. The company is planning to conduct stock splits in the ratio of 4 for 1 as described in the animation. If Tolbotics Inc. declares a 4-for-1 stock split, the price of the company’s stock after the split, assuming that the total value of the firm’s stock remains the same after the split, will be ________ Fuzzy Muffin Manufacturing Company is one of Tolbotics’s leading competitors. Fuzzy Muffin’s market intelligence research team shares Tolbotics’s plans of announcing a stock split, influencing the distribution policymakers. Consequently, executives at Fuzzy Muffin decide to offer stock dividends to its shareholders. Fuzzy Muffin currently has 1,900,000 shares of common stock outstanding. If the firm pays a 4% stock dividend, what will be the total number of shares outstanding after the stock dividend? 1,976,000 shares 2,173,600 shares 2,272,400 shares 2,371,200 shares
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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Companies sometimes consider stock splits to bring down the price so that the stock attracts more purchases.
Consider the following case:
Tolbotics Inc. currently has 15,000 shares of common stock outstanding. Its management believes that its current stock price of $90 per share is too high. The company is planning to conduct stock splits in the ratio of 4 for 1 as described in the animation.
If Tolbotics Inc. declares a 4-for-1 stock split, the price of the company’s stock after the split, assuming that the total value of the firm’s stock remains the same after the split, will be ________
Fuzzy Muffin Manufacturing Company is one of Tolbotics’s leading competitors. Fuzzy Muffin’s market intelligence research team shares Tolbotics’s plans of announcing a stock split, influencing the distribution policymakers. Consequently, executives at Fuzzy Muffin decide to offer stock dividends to its shareholders.
Fuzzy Muffin currently has 1,900,000 shares of common stock outstanding.
If the firm pays a 4% stock dividend, what will be the total number of shares outstanding after the stock dividend?
1,976,000 shares
2,173,600 shares
2,272,400 shares
2,371,200 shares
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