Distributions to Shareholders: Dividends and Share Repurchases

Companies sometimes consider stock splits to bring down the price so that the stock attracts more purchase:s Consider the following case: 3 for 1 Stock split announcement Mainway Toy Company currently has 25,000 shares of common stock outstanding. Its management believes that its current stock price of $95 per share is too high. The company is planning to conduct stock splits in the ratio of 3 for 1 as described in the animation scrlificate of $12 CD If Mainway Toy Company declares a 3-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, will be Fuzzy Muffin Manufacturing Company is one of Mainway's leading competitors. Fuzzy Muffin Manufacturing Company's market intelligence research team shares Mainway's plans of announcing a stock split, influencing the distribution policy makers Consequently, executives at Fuzzy Muffin decide to offer stock dividends to its shareholders If the firm pays a 4% stock dividend, how many shares will the firm issue to its existing shareholders? O 60,800 shares O 57,000 shares O 79,800 shares 76,000 shares A stock dividend is another way of keeping the stock price from going too high. Fuzzy Muffin currently has 1,900,000 shares of common stock outstanding