Coombs Corp. declared a two-for-one stock split. Solly Fogarty owned 500 shares of Coombs that were trading for $20 each before the split. Which of the following is likely to be true after the split?
A) The number of shares Solly owns will increase by 50%.
B) The market price per share will drop by 50%.
C) The total market value of Solly's shares will double.
D) The market price per share will increase by 100%.

Question

Quizplus · Accepted Answer

After a two-for-one stock split, the number of shares doubles, and the price per share typically halves, so the market price per share will drop by 50%.