Question
A stock split increases the number of outstanding shares, while the Blank______.
Multiple choice question.
stock price increases
firm's value increases
total owners' equity decreases
total owners' equity remains constant
Multiple choice question.
stock price increases
firm's value increases
total owners' equity decreases
total owners' equity remains constant
Answers
GPT-4o mini
A stock split increases the number of outstanding shares, while the **total owners' equity remains constant**.
This is because a stock split divides the existing shares into more shares but does not change the overall value of the firm or the total equity; it merely affects the share price and the number of shares outstanding.
This is because a stock split divides the existing shares into more shares but does not change the overall value of the firm or the total equity; it merely affects the share price and the number of shares outstanding.