Which One of the Following Involves a Payment in Shares

question 38

Multiple Choice

Which one of the following involves a payment in shares that increases the number of shares a shareholder owns but also decreases the value per share?

• A) Cash dividend
• B) Stock dividend
• C) Stock repurchase
• D) Stock split
• E) Reverse stock split

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Definitions:

Competitive Market

A market structure characterized by many buyers and sellers, free entry and exit, and products that are similar enough to be considered substitutes.

Market Supply Curve

A graphical representation showing the quantity of a good that producers are willing and able to sell at various prices within a specific time period.

Perfectly Elastic

Describes a situation where the quantity demanded or supplied responds infinitely to changes in price.

Long-Run

Refers to a period during which all factors of production and costs are variable, and all possible changes in production capacity can be undertaken.