Question

Suppose that you own 1,600 shares of Nocash Corp. and the company is about to pay a 25% stock dividend. The stock

currently sells at $100 per share.

a. What will be the number of shares that you hold after the stock dividend is paid? (Do not round intermediate calculations.)

b. What will be the total value of your equity position after the stock dividend is paid? (Do not round intermediate calculations.)

c. What will be the number of shares that you hold if the firm splits five-for-four instead of paying the stock dividend?

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