The primary purpose of a stock split is to
A) increase paid-in capital
B) reduce the market price of the stock per share
C) increase the market price of the stock per share
D) increase retained earnings

Question

Quizplus · Accepted Answer

A stock split increases the number of outstanding shares while decreasing the market price of the stock per share. This is done in order to make the stock more affordable and accessible to a larger number of investors. It does not directly affect paid-in capital, retained earnings, or the market price of the stock per share.

The Primary Purpose of a Stock Split Is to