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Suppose that I paid $2,000 for 100 shares of Enlighten Software Solutions on April 4, 1999....

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Finance

Suppose that I paid $2,000 for 100 shares of Enlighten SoftwareSolutions on April 4, 1999. Today, the company is worth only 15cents per share. Suppose that in order to be listed on a particularexchange, it must be priced at $1.50 (or above).

a. What sort of corporate reorganization can the firm conduct toachieve the minimum listing price, holding all else constant?

b. If the firm takes your advice in part (a), how many shareswould I own?

Answer & Explanation Solved by verified expert
3.6 Ratings (570 Votes)
a Current value per share 15 cents 015 Minimum value per share needed for listing Desired price 150 Consolidation or merging of shares by the help of reverse stock split can increase the value per share Reverse stock    See Answer
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Suppose that I paid $2,000 for 100 shares of Enlighten SoftwareSolutions on April 4, 1999. Today, the company is worth only 15cents per share. Suppose that in order to be listed on a particularexchange, it must be priced at $1.50 (or above).a. What sort of corporate reorganization can the firm conduct toachieve the minimum listing price, holding all else constant?b. If the firm takes your advice in part (a), how many shareswould I own?

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