Question: 5. State whether a statement is true or false. Then explain why you think the statement true or false. (20 pt) 3. A 2-for-1 stock

5. State whether a statement is true or false. Then explain why you think the statement true or false. (20 pt) 3. A 2-for-1 stock split will double the market price of the stock and will double the stockholders' equity. (5 pt.) False. b. Purchase of treasury stock would increase earnings per share. (5 pt.) 0. Company A has a debt ratio of 0.5 and company B has a debt ratio of 0.75. Considering everything else of the two companies are same, company A is much riskier than company B if recession hits in the market. (5 pt.) False. d. Market price of a bond and face value of bond will always be the same. (5 pt.) False

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