Which of the Following Occurs When a 2-For-1 Stock Split

question 39

Multiple Choice

Which of the following occurs when a 2-for-1 stock split is declared?

• A)The balance in common stock remains the same.
• B)The balance in common stock is reduced to half the original amount.
• C)The balance in common stock doubles.
• D)The balance in paid-in capital doubles.

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Definitions:

Eurobond

A bond issued in a currency other than the home currency of the country or market in which it is issued, often not subject to the regulations of a single country.

International Bond

A bond issued in a country by a non-domestic entity, often in a currency other than that of the issuer's country.

Purchasing Power Parity

An economic theory that compares different countries' currencies through a "basket of goods" approach to determine the relative value of currencies.

Price Adjustment

A change in the purchase price of a good or service in response to market factors or contractual terms.