Reverse stock splits are used by companies whose low share price
A) puts the company at risk of being listed on a stock exchange as a result of their share price being barely above the minimum threshold for listing on the exchange.
B) makes them eligible investments for certain institutional investors.
C) allows them to list on a public exchange.
D) prevents them from listing on a public exchange.

Question

Quizplus · Accepted Answer

Reverse stock splits are often used by companies to increase their share price to meet the minimum price requirements for listing on a public exchange, thus preventing them from being delisted.

Reverse Stock Splits Are Used by Companies Whose Low Share