A firm's 10,000,000 shares have a market value of $1 billion. If the firm splits its stock 4 for 1, the per share value will be $25 after the split.

Question

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Before the split, each share has a market value of $100 ($1 billion divided by 10,000,000 shares). 
After the split, the firm will have 40,000,000 shares (10,000,000 x 4). 
If the market value remains the same at $1 billion, each share would have a market value of $25 ($1 billion divided by 40,000,000 shares). Therefore, the per-share value would be $25 after the split.

A Firm's 10,000,000 Shares Have a Market Value of $1