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Question
Kelly owns 10,000 shares in McCormick Spices, which currently has 500,000 shares outstanding. The stock sells for $86 on the open market. McCormick's management has decided on a 2-1 split.a. Will Kelly's financial position alter after the split, assuming that the stocks will fall proportionately?
b. Assuming only a 35% fall on each stock, what will be Kelly's value after the split?
Answer
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