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XYZ Corporation has 400000 shares of common stock outstanding a PE ratio of 8 and 500000 available for common stockholders The board of directors has just voted a 32 stock split a If you

XYZ Corporation has 400,000 shares of common stock outstanding, a P/E ratio of 8, 
and $500,000 available for common stockholders. The board of directors has just 
voted a 3-2 stock split. 
a. If you had 100 shares of stock before the split, how many shares will you have
after the split? 
b. What was the total value of your investment in XYZ stock before the split? 
c. What should be the total value of your investment in XYZ stock after the split?
d. In view of your answers to (b) and (c) above, why would a firm's management
want to have a stock split? 

Apr 16 2021 View more View Less

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