A Firm Has Declared a Stock Dividend That Pays 1

question 6

Multiple Choice

A firm has declared a stock dividend that pays 1 share of stock for every 11 shares owned.After the stock dividend,earnings per share will:

• A) remain the same.
• B) decline 9.1%.
• C) decline 8.3%.
• D) increase 8.3%

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Definitions:

Edict of Nantes

A 1598 decree issued by Henry IV of France, granting substantial rights and tolerance to Huguenots (French Protestants), marking a move toward religious coexistence.

Thirty Years War

A protracted conflict that took place between 1618 and 1648, primarily within the Holy Roman Empire, involving most of the major European powers and marked by widespread destruction and high civilian casualties.

Joint Stock Company

A business entity where different stocks can be bought and owned by shareholders, allowing for the pooling of capital and sharing of profits or losses.

Narragansett Indians

A Native American tribe originally from the Rhode Island area, known for their rich culture, history of resistance and adaptation during European colonization, and ongoing efforts to preserve their heritage.