Own 100 Shares of Troll Brothers' Stock, Which Currently Sells

question 27

Multiple Choice

own 100 shares of Troll Brothers' stock, which currently sells for $120 a share.The company is contemplating a 2-for-1 stock split.Which of the following best describes what your position will be after such a split takes place?

• A)You will have 200 shares of stock, and the stock will trade at or near $120 a share.
• B)You will have 200 shares of stock, and the stock will trade at or near $60 a share.
• C)You will have 100 shares of stock, and the stock will trade at or near $60 a share.
• D)You will have 50 shares of stock, and the stock will trade at or near $120 a share.
• E)You will have 50 shares of stock, and the stock will trade at or near $60 a share.

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Definitions:

Economic Loss

Economic loss refers to a decrease in financial resources or potential wealth, often resulting from business operations, market conditions, or external factors impacting income or asset value.

Economic Profit

The remaining amount after subtracting both explicit and implicit costs from a company's total income.

Average Total Cost

The total cost divided by the total quantity produced, representing the cost per unit of output.

Marginal Revenue

The uplift in revenue achieved by marketing an additional unit of a product or service.