Keys Financial Has Done Extremely Well in Recent Years, and Its

question 26

Multiple Choice

Keys Financial has done extremely well in recent years, and its stock now sells for $175 per share. Management wants to get the price down to a more typical level, which it thinks is $25 per share. What stock split would be required to get to this price, assuming the transaction has no effect on the total market value? Put another way, how many new shares should be given per one old share?

• A) 6.65
• B) 6.98
• C) 7.00
• D) 7.35
• E) 7.72

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Definitions:

Fidelity

Sustained loyalty, faith, or sense of belonging that results from the successful resolution of Erikson’s identity versus identity confusion psychosocial stage of development.

Adolescence

The transitional stage of development between childhood and adulthood, characterized by physical, psychological, and social changes.

Extension of Trust

The process of developing deeper levels of trust in relationships or interactions, often through repeated positive experiences or the demonstration of reliability.

Cliquishness

The tendency to form exclusive groups or cliques, often leading to exclusionary behavior and social fragmentation.