All of the Following Statements Are True About a 3-For-1

question 132

Multiple Choice

All of the following statements are true about a 3-for-1 split, except:

• A) total contributed capital increases.
• B) the market price will probably decrease.
• C) par value per share is reduced to one-third of what it was before the split.
• D) a stockholder with twenty shares before the split owns sixty shares after the split.

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Definitions:

Special Warranty Deed

A type of deed in which the seller guarantees the title only against defects arising during their ownership and not against defects existing before that time.

Warrants

Warrants are financial instruments issued by companies that give the holder the right to purchase company stock at a specific price before a certain date.

Title Defects

Issues with a property's title that could limit the owner’s ability to possess, use, or transfer the property, such as liens or encroachments.

Encumbrances

Claims, liens, charges, or restrictions on property that may affect its value, use, or transferability.