1a) The pre-split market capitalization for Gm Corporation is $583.2 million ($129.60 x 4.5 million).
1b) The post-split number of shares is 11.25 million shares (4.5 million x 5/2).
1c) The post-split market price per share for GM Corporation is $51.84 ($129.60 x 2/5).
1d) The post-split market capitalization for GM Corporation is $583.2 million ($51.84 x 11.25 million).
What is a Stock-Split?
A stock split divides a company's shares into more number of shares. By this division, the number of shares are increased while the share price is lowered.
For example, GM Corporation's 5-for-2 stock split increases its outstanding shares from 4.5 million shares to 11.25 million shares.
Similarly, Burger Chain's 3-for-1 stock split, will increase the outstanding number of shares while reducing the price from $48.81 to $16.27.
Data and Calculations:
GM Corporation:
Business initiative = 5-for-2 stock split
Price before split = $129.60
Outstanding number of shares = 4.5 million
New number of shares = 11.25 million (4.5 million x 5/2)
a) The pre-split market capitalization for Gm Corporation is $583.2 million ($129.60 x 4.5 million).
b) The post-split number of shares is 11.25 million shares (4.5 million x 5/2).
c) The post-split market price per share per share for GM Corporation is $51.84 ($129.60 x 2/5).
d) The post-split market capitalization for GM Corporation is $583.2 million ($51.84 x 11.25 million).
Burger Chain:
Business initiative = 3-for-1 stock split
Price before split = $48.81
Dividend per share = $2.07
2a) The new price of one share after the split for Burger Chain is $16.27 ($48.81 x 1/3).
2b) The new dividend after the split is $0.69 ($2.07 x 1/3).
Learn more about market capitalization and stock splits at https://brainly.com/question/20377743
