In a Stock Split or Stock Dividend, the Company Issues

question 43

True/False

In a stock split or stock dividend, the company issues additional shares rather than cash to its shareholders.

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Definitions:

Market Price

The price at which an asset or service can be bought or sold in the market.

Dividends

Payments made to shareholders out of a corporation's earnings, typically on a regular basis.

Common Stock

A type of equity security that represents ownership in a corporation, with voting rights and potential dividends.

Acid-Test Ratio

A stringent indicator of a company's short-term liquidity, calculated by dividing current assets excluding inventory by current liabilities.