A Two-For-One Stock Split Will Result In

question 53

Multiple Choice

A two-for-one stock split will result in:

• A) the firm acquiring new assets.
• B) a decrease in the stock price, but an increase in shareholder wealth.
• C) an increase in the stock price, and an increase in shareholder wealth.
• D)a decrease in the stock price and no change to shareholder wealth.

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Definitions:

Soft Drink Industry

A sector of the beverage industry that manufactures, markets, and sells nonalcoholic beverages such as sodas, iced teas, and energy drinks.

Aluminum Industry

The sector of the economy that involves the extraction, production, and processing of aluminum, a lightweight and durable metal used in various applications.

Homogeneous Oligopoly

A market structure characterized by few sellers offering products that are identical or very similar, making competition based mostly on price.

Household Laundry Products

A category of consumer goods including detergents, fabric softeners, and stain removers used in the washing of clothes.