Question 1) Current Stock Sale Price = $40 per share and there are 1,200,000 shares outstanding. What is the effect on # of shares outstanding and stock price if:
a) 15% Dividend
b) 4-for-3 Stock Split
c) Reverse 3-for-1 Stock Split
Question 2) If 2 companies have the same Net Income ($1,000,000) and the same Assets ($10,000,000), Explain why one has 11.1% ROE and the other has 20% ROE, what are the possible reasons for the difference in ROE?