Dilution of Ownership Occurs When a New Stock Issue Results

question 64

True/False

Dilution of ownership occurs when a new stock issue results in each present stockholder having a larger number of shares and, thus, a claim to a larger part of the firm's earnings than previously.

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Definitions:

Adaptive Trait

A characteristic of an organism that has been favored by natural selection and increases the fitness of the individual in its environment.

Phenotypically Different

Exhibiting differences in physical and physiological traits as a result of variations in genetic expression or environmental influences.

Species Diversity

A measure of diversity within an ecological community that incorporates both the number of species present and their relative abundance.

Gradual Geologic Forces

Slow-moving natural processes that shape the Earth's surface over millions of years, including erosion and plate tectonics.