A 2-For-1 Share Split

question 3

Multiple Choice

A 2-for-1 share split

• A) increases the number of shares held by the firm's shareholders.
• B) increases the per share price of the firm's shares.
• C) requires shareholders to invest more money in the firm's shares.
• D) requires the firm to adjust the value of its total assets in the financial position.
• E) generally decreases the total value of the firm that splits its shares.

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Definitions:

Consistency

The quality of always behaving or performing in a similar way, maintaining the same standards over time.

Reciprocity Norm

A social rule that suggests people should return help and cooperation they have received from others.

Potential Customer

An individual or entity that could be interested in purchasing a product or service, but has not yet decided to do so.

Reactance Response

A psychological reaction that occurs when people feel their freedom to choose or act is threatened, leading them to resist the influence or change.