Polycorp wishes to make a three
for one stock split (each share will be replaced by three shares)....

Question

Polycorp wishes to make a three
for one stock split (each share will be replaced by three shares). The current
share price is $8.13. What is the theoretical ex-split price? Are the
shareholders better off after the split, why or why not? No more than a short
paragraph is required for this answer.

David · Accepted Answer

Polycarp wishes to make a three for one stock split (each share will be replaced by three 
shares). The current share price is $8.13. What is the theoretical ex-split price? Are the 
shareholders better off after the split, why or why not? No more than a short paragraph is 
required for this answer. 
Solutions 
Current Share Price   = $8.13 
Stock Split   = 3 for 1 
A three for one stock split implies that for every share owned previously, now the owner will 
be having three shares.

Polycorp wishes to make a three for one stock split (each share will be replaced by three shares). The current share price is $8.13. What is the theoretical ex-split price? Are the shareholders better...

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