Share splits are conducted because it is believed that:
A) Excess capital leads to reduced return ratios, which the market does not view favourably.
B) Increasing the number of shares issued makes the company appear larger and more stable.
C) Decreasing the price per share makes them more marketable.
D) Investors view this as a bonus because they now have more shares than they previously held.

Question

Quizplus · Accepted Answer

Share splits are conducted to decrease the price per share, making them more affordable and attractive to investors. This can increase demand and liquidity for the company's shares, potentially boosting the stock price in the long run. Excess capital and share issuance do not necessarily require a stock split.

Share Splits Are Conducted Because It Is Believed That