1. Explain why managers of firms might prefer that their firm's stock be traded in a moderate per-share range rather than a high-share price range. How do firms keep their shares trading in that range?
2. Three years ago you purchased four thousand shares of Metwa, Inc. for $17 per share. Today Metwa, Inc. is repurchasing its shares through a fixed price tender offer at a price of $45 per share. What are the after tax proceeds you will receive if the capital gains tax is 20%?
3. Why would the management of a company undertake a reverse split?