A Stock Has a Normal Trading Range of $22 to $30

question 196

Multiple Choice

A stock has a normal trading range of $22 to $30. The stock is currently selling at $41 a share. It would be common for a firm in this situation to:

• A) Repurchase outstanding shares by issuing debt securities.
• B) Do a reverse stock split to lower the market price of the stock.
• C) Issue a one-time special dividend.
• D) Increase the number of outstanding shares via a stock split.
• E) Issue a liquidating dividend to lower the value of the firm.

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