Which of the following is a reason a company would declare a stock split?
A)To increase the marketability of its shares.
B)To increase the share price in the market.
C)To increase the value of the company.
D)To increase the legal paid-in capital of the company.

Question

Quizplus · Accepted Answer

A stock split is a corporate action in which a company divides its existing shares into multiple shares to increase the number of outstanding shares. This is done to make the shares more affordable and increase the marketability of the shares, as well as to make the stock appear more attractive to investors by reducing the share price. It does not directly impact the value of the company or increase its legal paid-in capital.

Which of the Following Is a Reason a Company Would