Question

The Olive Vase has 56,000 shares of stock outstanding with a par value of $1 per share and a market value of $11 a share. The company just announced a 3-for-4 reverse stock split. Currently, you own 400 shares of this stock. What will the total value of your shares be after the reverse stock split?

Answer 1

Answer:

The total value of your shares be after the reverse stock split is $5,500

Explanation:

The total value of your shares will not change.

Consider the following calculation to obtain the answer

Total value = 500(3/4) * $11(4/3) = $5,500