Share Splits Are Conducted Because It Is Believed That

question 16

Multiple Choice

Share splits are conducted because it is believed that:

• A) Excess capital leads to reduced return ratios, which the market does not view favourably.
• B) Increasing the number of shares issued makes the company appear larger and more stable.
• C) Decreasing the price per share makes them more marketable.
• D) Investors view this as a bonus because they now have more shares than they previously held.