A firm's 1,000,000 shares have a market value of $500,000. If the firm reverse splits its stock 1 for 4, the per share value will be $2 after the split.

Name: A firm's 1,000,000 shares have a market value of $500,000. If the firm reverse splits its stock 1 for 4, the per share value will be $2 after the split.
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After the reverse split, the firm will have 250,000 shares (1/4th of the original) and the market value will still be $500,000. Therefore, the per share value will be $2 ($500,000/250,000).

A Firm's 1,000,000 Shares Have a Market Value of $500,000