A Stock Split

question 197

Multiple Choice

A stock split

• A)may occur in the absence of retained earnings.
• B)will increase total paid-in capital.
• C)will increase the total par value of the stock.
• D)will have no effect on the par value per share of stock.

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Definitions:

Marginal Social Cost

The additional cost incurred by society as a whole due to the production of one more unit of a good or service.

Damage Cost

The monetary cost associated with the harm done to goods in an economy, which can result from disasters, accidents, or intentional acts.

Negative Externality

An adverse effect suffered by a third party as a result of an economic transaction in which they had no involvement.

Internalize

The process of incorporating the cost of externalities into the decision-making process of firms or individuals.