When a Share Split Occurs

question 20

Multiple Choice

When a share split occurs:

• A) Current shareholders receive more shares thus increasing their stake in the company.
• B) Accounting entries are required to record the increase in the number of shares on hand.
• C) It must be done so that any uncalled amounts are divided equally when the shares are issued.
• D) More shares are available to be purchased by the general public, allowing the company to raise more funds.
• E) None of the given answers.

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Definitions:

Tight Money Policy

A monetary policy strategy used by central banks to slow economic growth by increasing interest rates and reducing the supply of money.

Government Bonds

Fixed-income securities issued by a government to support government spending, typically offering a regular interest payment and repayment of the principal at maturity.

Easy Money

A monetary policy stance characterized by low interest rates and high availability of credit to encourage economic growth.

Exports

Products or services made in one country and purchased by consumers in a different country, adding to the exporting nation's overall economic output.