Question

The Meltzer Corporation is contemplating a 7-for-3 stock split. The current stock price is $75.00 per share, and the firm believes that its total market value would increase by 5% as a result of the improved liquidity that it thinks would follow the split. What is the stock's expected price following the split?
a. $32.06
b. $33.75
c. $35.44
d. $37.21
e. $39.07

Answer

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