A) A firm has 50,000 shares of stock outstanding, net income of $50,000, and a PE ratio of 15. What will the firm’s PE ratio be if the firm repurchases 25,000 shares? Assume all else remains constant.
A) 12.0
B) 13.0
C) 15.0
D) 7.50
B) An investor owns 1000 shares of stock in ABC Corp. with a market value of $1,100. ABC declares a 10% stock dividend. After the dividend is paid, John owns____________
A) 1000 shares with a market value of $1,000.
B) 1000 shares with a market value of $1,100.
C) 1100 shares with a market value of $1,100.
D) 1100 shares with a market value of $1,000.
C) A firm currently has 200,000 shares of stock outstanding at a market price per share of $120. Today, the firm announced a 3-for-1 stock split. What will the price per share be after the split?
A) $240.00
B) $120.00
C) $40.00
D) $60.00