In a 1 for 4 stock split, a share trading at $10 prior to the split would be trading at_________after the split.
A) $2
B) $2.50
C) $40
D) $10

Question

Quizplus · Accepted Answer

In a 1 for 4 stock split, the number of shares outstanding increases by a factor of 4, while the price per share decreases by a factor of 4. Therefore, a share trading at $10 prior to the split would be trading at $10 / 4 = $2.50 after the split.

In a 1 for 4 Stock Split, a Share Trading