10. Stock dividends and stock splits Aa Aa Companies sometimes consider stock splits to bring down the price so that the stock attracts more purchases. Consider the following case: certificate of Stock $12 Mainway Toy Company currently has 25,000 shares of common stock outstanding. Its management believes that its current stock price of $100 per share is too high. The company is planning to conduct stock splits in the ratio of 4 for 1 as described in the animation. If Mainway Toy Company declares a 4-for-1 stock split, what will be the price of the company's stock after the split, assuming that the total value of the firm's stock remains the same after the split? Hackworth Hardware Company is one of Mainway's leading competitors. Hackworth's market intelligence research team shares Mainway's plans of announcing a stock split, influencing the distribution policy makers. Consequently, executives at Hackworth decide to offer stock dividends to its shareholders. If the firm pays a 4% stock dividend, what will be the total number of shares outstanding after the stock dividend? O 3,328,000 shares O 3,993,600 shares O 3,827,200 shares O 3,494,400 shares Hackworth currently has 3,200,000 shares of common stock