Question
Please see statements below and give comments (short explanations) if they FALSE/TRUE. When a firm pays a stock dividend, the shareholder's proportion of ownership in
Please see statements below and give comments (short explanations) if they FALSE/TRUE.
When a firm pays a stock dividend, the shareholder's proportion of ownership in a firm remains the same, and as long as the firm's earnings remain unchanged, so does his or her share of total earnings.
If a firm's earnings remain constant and total cash dividends do not increase, a stock dividend results in a lower per-share market value for the firm's stock.
After the stock dividend is paid, the per share value of a stockholder's stock will remain the same as the value before the stock dividend and, thus, the market value of his or her total holdings in the firm will remain unchanged.
In a 2-for-1 stock split, the number of shares outstanding decreases by fifty percent and the stock's per share par value will double.
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