Fundamentals Of Financial Management, Concise Edition (mindtap Course List)
10th Edition
ISBN: 9781337902571
Author: Eugene F. Brigham, Joel F. Houston
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 14, Problem 2P
Summary Introduction
To calculate: Stock price after the splitting 3 for 2 stocks.
Introduction:
Stock Split:
When a company has large number of outstanding shares then the board of directors decide to issue more shares to the current shareholders thus, it results in decreasing the number of outstanding shares and increasing the shares prices.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Emergency Medical’s stock trades at $145 a share. The company is contemplatinga 3-for-2 stock split. Assuming that the stock split will have no effect on the marketvalue of its equity, what will be the company’s stock price following the stock split?
STOCK SPLIT Emergency Medical’s stock trades at $145 a share. The company is contemplatinga 3-for-2 stock split. Assuming that the stock split will have no effect on the marketvalue of its equity, what will be the company’s stock price following the stock split
emergency medicals stock trades at 145 a share. the company is contemplating a 3 for 2 stock split. assuming that the stock split will have no effect on the market value of its equity, what will be the company's stock price following the stock split
Chapter 14 Solutions
Fundamentals Of Financial Management, Concise Edition (mindtap Course List)
Ch. 14 - Prob. 1QCh. 14 - Prob. 2QCh. 14 - Would it ever be rational for a firm to borrow...Ch. 14 - Modigliani and Miller (MM), on the one hand, and...Ch. 14 - Prob. 5QCh. 14 - One position expressed in the financial literature...Ch. 14 - Prob. 7QCh. 14 - What is the difference between a stock dividend...Ch. 14 - Most firms like to have their stock selling at a...Ch. 14 - Prob. 10Q
Ch. 14 - Prob. 11QCh. 14 - RESIDUAL DIVIDEND MODEL Altamonte...Ch. 14 - Prob. 2PCh. 14 - STOCK REPURCHASES Gamma Industries has net income...Ch. 14 - Prob. 4PCh. 14 - EXTERNAL EQUITY FINANCING Coastal Carolina Heating...Ch. 14 - RESIDUAL DIVIDEND MODEL Walsh Company is...Ch. 14 - DIVIDENDS Brooks Sporting Inc. is prepared to...Ch. 14 - Prob. 8PCh. 14 - ALTERNATIVE DIVIDEND POLICIES In 2018, Keenan...Ch. 14 - Prob. 10SPCh. 14 - Prob. 11ICCh. 14 - Prob. 1TCLCh. 14 - Prob. 2TCLCh. 14 - Prob. 3TCLCh. 14 - Investors are more concerned with future dividends...Ch. 14 - Prob. 5TCL
Knowledge Booster
Similar questions
- Emergency Medical's stock trades at $140 a share. The company is contemplating a 3-for-2 stock split. Assuming that the stock split will have no effect on the market value of its equity, what will be the company's stock price following the stock split? Round your answer to the nearest cent.arrow_forwardAutomotive Supplies Inc’s Stock trades at $50 a share. The company is contemplating a 4-for-3 stock split. Assuming that the stock split will have no effect on the market value of its equity, what will be the company’s stock price following the stock split? Select one: a. $50.00 b. $80.00 c. $75.00 d. $37.50arrow_forwardJPix management is considering a stock split. JPix currently sells for$120 per share and a 3-for-2 stock split is contemplated. What will be thecompany’s stock price following the stock split, assuming that the split hasno effect on the total market value of JPix’s equity?arrow_forward
- WorldTrans is considering a 8-for-4 stock split. The current stock price is $75.00 per share, and the firm believes that its total market value would increase by 6% as a result of the improved liquidity that should follow the split. What is the stock's expected price following the split? Group of answer choices $40.15 $41.34 $47.30 $31.40 $39.75arrow_forwardLoiselle Graphics recently announced a 3-for-1 stock split. Prior to the split, the company's stock was trading at $90 per share. The split had no effect on the wealth of the company's investors. What will be the new stock price? $180 $30 $270 $45 $60arrow_forwardFinancearrow_forward
- Mid-State BankCorp recently declared a 7-for-2 stock split. Prior to the split, the stock sold for $100 per share. If the firm's total market value is unchanged by the split, what will the stock price be following the split? Select one: a. $28.57 b. $25.43 c. $26.29 d. $28.86 e. $35.71arrow_forwardMid-State BankCorp recently declared a 7-for-2 stock split. Prior to the split, the stock sold for $100 per share. If the firm's total market value is unchanged by the split, what will be the stock price following the split?arrow_forwardc) Let us say, the stock exchange listing requirements stipulate that once the share of your company trades at a price of $20 or less, the share will be delisted from the exchange and no further trades will be allowed. You observe that currently the share of your company is trading at around $25 per share on the stock exchange. What do you recommend in such a situation: A stock split or a reverse stock-split? Why?arrow_forward
- Effects of a stock split Assume that you own 3,600 shares of $10 par value common stock and the company has a 4-for-1 stock split when the market price per share is $68.Required:How many shares of common stock will you own after the stock split?What will probably happen to the market price per share of the stock?What will probably happen to the par value per share of the stock?arrow_forwardThe Big Container Company’s stock was trading by Rs. 90 per share, prior to the split. The company recently announced a 3-for-1 stock split. The split had no effect on the wealth of the company’s investors. What will be the new stock price?arrow_forwardelizabeth eaarns $9.50 a share, sells for $90, and pays a $6 per sharedeviden. the stock is split two for one and a $3 pers share cash dividend is diclared. what will be the new price of the stock? if the firms total earnings to do not change, what is the payout ratio before and after stock split?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Intermediate Financial Management (MindTap Course...FinanceISBN:9781337395083Author:Eugene F. Brigham, Phillip R. DavesPublisher:Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENTFinanceISBN:9781337514835Author:MOYERPublisher:CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:9781337514835
Author:MOYER
Publisher:CENGAGE LEARNING - CONSIGNMENT