The Effect of a Bonus Issue to All Shareholders on (A)net

question 4

Multiple Choice

The effect of a bonus issue to all shareholders on (a) net asset backing per share,(b) each shareholder's share of net assets and (c) market capitalisation is:

• A) (a) The net asset backing per share will decrease; (b) each shareholder's share of net assets will remain the same; (c) evidence suggests that on average the market capitalisation will increase.
• B) (a) The net asset backing per share will increase; (b) each shareholder's share of net assets will increase; (c) evidence suggests that on average the market capitalisation will remain the same.
• C) (a) The net asset backing per share will decrease; (b) each shareholder's share of net assets will decrease; (c) evidence suggests that on average the market capitalisation will remain the same.
• D) (a) The net asset backing per share will remain the same; (b) each shareholder's share of net assets will decrease; (c) evidence suggests that on average the market capitalisation will decrease.
• E) None of the given answers.

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Definitions:

Empathy

The ability to comprehend and share another person's feelings or mental state.

Contextual Perspective

The approach of considering the influence of environmental, social, and historical contexts on events, behaviors, and decisions.

Gender Typing

The process by which a child becomes aware of their gender and behaves according to their cultural norms and expectations.

Socialization

The process by which individuals learn and adopt the norms, values, customs, and behaviors appropriate to their society or social group.