A Reverse Stock Split Is Sometimes Used as a Means

question 9

Multiple Choice

A reverse stock split is sometimes used as a means of:

• A)decreasing the liquidity of a stock.
• B)decreasing the market value per share.
• C)increasing the number of shareholders.
• D)keeping a firm's equity eligible for trading on a stock exchange.
• E)raising cash from current shareholders.

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Definitions:

Limited Liability Company

A flexible form of business enterprise that blends elements of partnership and corporate structures, offering personal liability protection to its owners.

Nonprofit Corporation

A legal entity organized for a collective purpose, such as charitable, educational, cultural, or social welfare, without intent for profit distribution to its members or directors.

Merger Approval

The official sanction by regulatory authorities allowing two or more companies to consolidate into one entity.

Cash-Out Combinations

Financial strategies or transactions where owners of a business sell their stake in the company, partially or entirely, for cash.