FNAN 522 EXAM QUESTIONS WITH
CORRECT SOLUTIONS||100%
GUARANTEED PASS||UPDATED
2026/2027 SYLLABUS||A+
GRADED||<<NEWEST VERSION>>
Which of the following changes after a stock splits?
a. The stock's per share price.
b. The stockholder's ownership percentage in
the company.
c. The company's total market value.
d. All of these answers. - ANSWER ✓ a. The stock's per share price.
Which of the following is a possible market reaction to an stock repurchase
announcement?
a. All of these answers.
b. The stock price may increase because the repurchase signals that the company
views the shares as currently undervalued.
c. The stock price may fall because the repurchase signals that the company's
future earnings may not be as high as the market currently expects.
d. The share price may increase because the repurchase signals that the company is
shifting to a higher degree of leverage to maximize returns to shareholders. -
ANSWER ✓ a. All of these answers.
Which of the following is a benefit of a company paying a smaller dividend?
a. All of these answers.
b. More money is being reinvested by the company in new products, increasing its
overall value
c. It could lead to lower taxes in the long-run for the shareholder.
d. A low dividend yield may indicate that the firm is experiencing rapid growth. -
ANSWER ✓ a. All of these answers.
, Which of the following is a reason a company might have for initiating a reverse
stock split?
a. To decrease the number of its shareholders.
b. To prevent the stock from being delisted from a stock exchange.
c. To encourage institutional investors and mutual funds to purchase the stock.
d. All of these answers. - ANSWER ✓ d. All of these answers.
Which of the following is an accurate description of one of the dates related to
issuing dividends.
a. The ex-dividend date refers to when the shareholders must be registered on
record.
b. The declaration date is the day the board of directors announces it will pay a
dividend.
c. The in-dividend date is the last day when the stock is cum dividend.
d. All of these answers - ANSWER ✓ b. The declaration date is the day the board
of directors announces it will pay a dividend.
Which of the following is a possible market reaction to a company's
announcement that it will increase it's quarterly dividend?
a. The share price may increase because the increased dividend signals that future
earnings will be higher than the market currently expects.
b. The share price may decrease because the increased dividend signals that future
earnings will be higher than the market currently expects.
c. The share price may increase because the increased dividend signals that future
earnings will be lower than the market currently expects.
d. All of these answers. - ANSWER ✓ a. The share price may increase because the
increased dividend signals that future earnings will be higher than the market
currently expects.
Which of the following statements regarding what dividends can mean to
prospective investors is true?
a. Consistent dividends signal that earnings generated by the stock will be volatile.
b. Stocks with consistently high dividends tend to mitigate agency conflicts
between investors and firm management
CORRECT SOLUTIONS||100%
GUARANTEED PASS||UPDATED
2026/2027 SYLLABUS||A+
GRADED||<<NEWEST VERSION>>
Which of the following changes after a stock splits?
a. The stock's per share price.
b. The stockholder's ownership percentage in
the company.
c. The company's total market value.
d. All of these answers. - ANSWER ✓ a. The stock's per share price.
Which of the following is a possible market reaction to an stock repurchase
announcement?
a. All of these answers.
b. The stock price may increase because the repurchase signals that the company
views the shares as currently undervalued.
c. The stock price may fall because the repurchase signals that the company's
future earnings may not be as high as the market currently expects.
d. The share price may increase because the repurchase signals that the company is
shifting to a higher degree of leverage to maximize returns to shareholders. -
ANSWER ✓ a. All of these answers.
Which of the following is a benefit of a company paying a smaller dividend?
a. All of these answers.
b. More money is being reinvested by the company in new products, increasing its
overall value
c. It could lead to lower taxes in the long-run for the shareholder.
d. A low dividend yield may indicate that the firm is experiencing rapid growth. -
ANSWER ✓ a. All of these answers.
, Which of the following is a reason a company might have for initiating a reverse
stock split?
a. To decrease the number of its shareholders.
b. To prevent the stock from being delisted from a stock exchange.
c. To encourage institutional investors and mutual funds to purchase the stock.
d. All of these answers. - ANSWER ✓ d. All of these answers.
Which of the following is an accurate description of one of the dates related to
issuing dividends.
a. The ex-dividend date refers to when the shareholders must be registered on
record.
b. The declaration date is the day the board of directors announces it will pay a
dividend.
c. The in-dividend date is the last day when the stock is cum dividend.
d. All of these answers - ANSWER ✓ b. The declaration date is the day the board
of directors announces it will pay a dividend.
Which of the following is a possible market reaction to a company's
announcement that it will increase it's quarterly dividend?
a. The share price may increase because the increased dividend signals that future
earnings will be higher than the market currently expects.
b. The share price may decrease because the increased dividend signals that future
earnings will be higher than the market currently expects.
c. The share price may increase because the increased dividend signals that future
earnings will be lower than the market currently expects.
d. All of these answers. - ANSWER ✓ a. The share price may increase because the
increased dividend signals that future earnings will be higher than the market
currently expects.
Which of the following statements regarding what dividends can mean to
prospective investors is true?
a. Consistent dividends signal that earnings generated by the stock will be volatile.
b. Stocks with consistently high dividends tend to mitigate agency conflicts
between investors and firm management
