Shell Inc. is having a stock split. The current price is $57 per share, and you own 500 shares. The split is a one-and-one-half-shares-for-one share split.

a)What is the expected per share price after the split?

b)What is your wealth before and after the split?

c)Based on empirical evidence, does the market value of outstanding shares (new price times new quantity) tend to increase or decrease on average when stocks split into a greater number (but lower priced) shares, as in this case?

Answer rating: 100% (QA)

Lets break it down a The expected per share price after the split Since the split is a oneandonehalf... View the full answer