Keys Financial Has Done Extremely Well in Recent Years,and Its

question 1

Multiple Choice

Keys Financial has done extremely well in recent years,and its stock now sells for $70 per share.Management wants to get the price down to a more typical level,which it thinks is $40.00 per share.What stock split would be required to get to this price,assuming the transaction has no effect on the total market value? Put another way,how many new shares should be given per one old share?

• A) 1.40
• B) 2.01
• C) 1.75
• D) 1.58
• E) 2.28

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Definitions:

Negotiable Instrument

A written promise to pay a certain sum of money, which can be demanded or paid at an agreed time, specifying the person responsible for payment in the document.

Holder

An individual or entity that legally owns or possesses a document, instrument, or title.

Authenticating Intent

the process of verifying that the actions or signatures of a person are genuine and intended to validate a legal document or agreement.

Indorsement

The act of signing a document, typically on the back of a negotiable instrument, indicating the legal transfer of its ownership.