Which of the following is the most valid reason to split a stock that has a market price of $110 per share?
A) Conserve cash.
B) Reduce the market price to a more popular trading range.
C) Obtain additional capital.
D) Increase investor's net worth.

Question

Quizplus · Accepted Answer

Splitting a stock is done to reduce the market price to a more popular trading range, making it more accessible to individual investors who may not have the financial means to purchase shares at a high price. This can increase demand and liquidity for the stock, potentially leading to an increase in price over time. The other options (A, C, D) are not valid reasons for a stock split.

Which of the Following Is the Most Valid Reason to Split