EBK CORPORATE FINANCE
EBK CORPORATE FINANCE
4th Edition
ISBN: 9780134202785
Author: DeMarzo
Publisher: VST
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Chapter 12, Problem 6P
Summary Introduction

To determine: The number of shares of WD Company held by Person X (investor).

Introduction:

Stock is a type of security in a company that denotes ownership. The company can raise the capital by issuing stocks.

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Suppose that you own 1,800 shares of Nocash Corp. and the company is about to pay a 25% stock dividend. The stock currently sells at $115 per share. a. What will be the number of shares that you hold after the stock dividend is paid? (Do not round intermediate calculations.) b. What will be the total value of your equity position after the stock dividend is paid? (Do not round intermediate calculations.) c. What will be the number of shares that you hold if the firm splits five-for-four instead of paying the stock dividend?
Suppose that you own 2,800 shares of Nocash Corp. and the company is about to pay a 25% stock dividend. The stock currently sells at $125 per share.   a. What will be the number of shares that you hold after the stock dividend is paid? (Do not round intermediate calculations.)   b. What will be the total value of your equity position after the stock dividend is paid? (Do not round intermediate calculations.)   c. What will be the number of shares that you hold if the firm splits five-for-four instead of paying the stock dividend? (Do not round intermediate calculations.)
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EBK CORPORATE FINANCE

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