A 3-For-1 Stock Split Will

question 78

Multiple Choice

A 3-for-1 stock split will:

• A) triple the par value and drop the number of outstanding shares by one-third.
• B) have no effect on the par value, but will affect the number of outstanding shares.
• C) have no effect on the number of outstanding shares, but will affect par value.
• D) cut the par value by one-third and triple the number of outstanding shares.

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Definitions:

Production Quota

A limit set by authorities or organizations on the amount of a product that can be produced, often used to control supply and stabilize or increase prices.

Producer Surplus

The gap between the price at which producers agree to sell a good or service and the price they end up receiving.

Government Incentive

A policy or measure implemented by the government to encourage or discourage specific economic activities.

Free Trade

An economic policy allowing imports and exports to occur without government intervention such as tariffs, quotas, or other restrictions.