The Primary Purpose of a Stock Split Is to

question 68

Multiple Choice

The primary purpose of a stock split is to

• A) issue additional shares.
• B) increase the dividend.
• C) reduce the price of stock.
• D) reduce trading activity.

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Definitions:

Market Capitalization Rate

The expected return on an investment in a company, based on its current market capitalization and future profit projections.

FCFE

Free Cash Flow to Equity, a measure of how much cash is available to the equity shareholders of a company after all expenses, reinvestment, and debt payments.

Intrinsic Value

Intrinsic Value is the actual value of a company, stock, currency, or product determined through fundamental analysis without reference to its market value.

FCFE

Free Cash Flow to Equity, a measure of how much cash is available to the equity shareholders of a company after all expenses, reinvestment, and debt payments have been made.