What will the company stck price be after the split

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Problem 1: Jones Company stock trades at $60 a share. The company is contemplating a 3-for-2 stock split. Currently, the company has EPS of 6.00, DPS of $0.75, ans 25 million shares of stock outstanding. Assuming that the stock split will have no effecton the total market value of its equity, what will the company's stck price be after the split?

Problem 2: Why do companies split their stock? Why might a split cause the P/E to increase?

Reference no: EM132831311

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