Stock Split
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Please help with the following problem. Provide step by step calculations for each.
You own 8% of the Standlee Corporation's common stock, which most recently sold for $98 before a planned two-for-one stock split announcement. Before the split there are 30,000 shares of common stock outstanding.
a. Relative to now, what will be your financial position after the stock split? (Assume the stock price falls proportionately)
b. The executive vice-president in charge of finance believes the price will only fall 45% after the split because she thinks the price is above the optimal price range. If she is correct, what will be your net gain?
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Solution Summary
The solution explains how to calculate the impact of a stock split. Step by step calculations are given for each problem.
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You own 8% of the Standlee Corporation's common stock, which most recently sold for $98 before a planned two-for-one stock split announcement. Before the split there are 30,000 shares of common stock outstanding.
a. Relative to now, what will be your financial position after the ...
Purchase this Solution
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