Last Week, Weschler Paint Corp

question 54

Multiple Choice

Last week, Weschler Paint Corp.completed a 3-for-1 stock split.Immediately prior to the split, its stock sold for $150 per share.The firm's total market value was unchanged by the split.Other things held constant, what is the best estimate of the stock's post-split price?

• A) $50.00
• B) $52.50
• C) $55.13
• D) $57.88
• E) $60.78

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Definitions:

Courts of Chancery

Courts that administer equity and handle matters such as trusts, estates, and guardianships, distinct from courts that deal with law.

Law of Equity

A branch of law that supplements common law by providing remedies and justice that are not available in traditional legal systems, focusing on fairness.

Common Law Courts

Courts that base their decisions on precedents or judicial rulings rather than written statutes.

Stare Decisis

A legal principle that obligates courts to follow historical cases when making a ruling on a similar current or future case.