A stock is currently selling for $40 a share. If the firm declares a 3-for-2 stock dividend there will be:
A) two-thirds as many shares outstanding priced at $60 each.
B) three times as many shares outstanding priced at $26.67 each.
C) 50% more shares outstanding priced at $26.67 each.
D)one-and-one-half times as many shares outstanding price at $60 each.

Question

Quizplus · Accepted Answer

Number of shares = 3/2 × original number of shares, or 50% more sharesPrice = 2/3 × $40 = $26.67

A Stock Is Currently Selling for $40 a Share