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11 September, 09:28

Jessica currently owns 500 shares of Alpha stock valued at $19 share. What will her investment in Alpha be worth if the company declares a 4-for-3 stock split?

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  1. 11 September, 09:36
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    The investment worth will be $9,500.

    Explanation:

    The total value of the investment will not change. The reason behind this is that a stock split only splits the face value and market to a lesser amount. The split will cause the number of shares to increase and market value of each share will decrease proportionately.

    The investment worth will be

    = 500*$19

    = $9,500
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