Which of the Following Statements Is True

question 57

Multiple Choice

Which of the following statements is true?

• A)Stock splits and stock dividends both reduce the market value of a share but only stock splits reduce the book value per share of issued shares.
• B)Stock splits reduce the book value of a share and stock dividends reduce the market value of a share.
• C)Stock splits and stock dividends both reduce the market value of a share but only stock splits reduce the retained earnings.
• D)Stock splits and stock dividends both reduce the market value of a share and the retained earnings.

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Definitions:

Declining Ratings

A situation where the popularity or approval ratings of an entity, such as a TV show or a political figure, decrease over time.

Profitable

Generating revenue in excess of costs and expenses, resulting in a financial gain.

Past Cash Flows

Historical records of the movement of money into and out of a business, used for analyzing the company's financial health.

Security's Value

The market value or price at which a financial security is traded on the market, determined by factors such as a company's profitability, growth potential, and overall economic conditions.