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adoni [48]
2 years ago
14

2. Why might it be a plus for a company to have such a high share price that trading in its stock is discouraged? What drawbacks

might there be for a company in this situation?
Business
1 answer:
Strike441 [17]2 years ago
6 0

While a high share price discourages trading in the company's stock, it advertises the company's stellar performance to existing and potential investors.

 

A high share price also discourages corporate takeovers, assuring the jobs of senior management. Existing investors can realize some quick gains by selling their shares at high profits.

 

2. The drawback of having a high share price is that investors willing to sell off their shares cannot do so because potential buyers are discouraged. Another disadvantage is that it puts much pressure on the management to maintain the entrenched performance level. Any subsequent fall in prices will not meet favorable reviews.

 

Thus, there are pluses and minuses to having a high share price.

Learn more: brainly.com/question/19717466

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Which of the following is part of the M2 definition of the money supply, but not part of M1?
STALIN [3.7K]

Answer:

The answer is b

Explanation:

Demand for money is the situation in which money are held in cash form without spending it. The demand for money is a derived demand in the sense that people do not spend all their salaries when they receive it at the end of the month. The portion of their salaries which they do not spent immediately they are received is what we referred to as the demand for money. There are three reasons for holding money which are

Transaction motive :This is the desire to keep money in order to meet the day to day transaction of business such as buying of foodstuff and to meet other family need .

Precautionary motive : This is the desire to keep money in order to meet the unforseen circumstances which are not planned for but which immediately occur, such as sickness, unexpected visitors, breakdown of one's car,

Speculative motive :This is the desire to keep money with the hope of using the money in making quick money. It is a money held with the hope of giving it out in form of loan if the interest is high and at a short period of time.for instance purchasing shares at a lower prices and re-selling it at higher prices .it also includes buying goods at a lower prices and re-selling at a higher prices for example cars.

7 0
2 years ago
Brown Fashions Inc.'s December 31, 2018 balance sheet showed total common equity of $4,050,000 and 265,000 shares of stock outst
PIT_PIT [208]

Answer: $16.60

Explanation:

The following information can be gotten from the question:

Total common equity = $4,050,000 Shares of stock outstanding = 265,000

Net Income = $450,000

Dividends = $100,000

Based on the information given, the book value per share will be calculated as:

(Total common equity + Net income - Dividends) / Outstanding shares

= ($4,050,000 + $450,000 - $100,000) / 265,000

= $4,400,000 / 265,000

= $16.60

6 0
3 years ago
On March 1, 2020, the Teal Company received a $45,000 payment for annual magazine subscriptions (the subscriptions run from the
bulgar [2K]

Answer:

The company has incorrectly credited the sales revenue account at the time of the receipt of payment. So, the  journal entry to record the transaction is as follows:

Date               Particulars                            Debit          Credit

March 1, 20    Sales Revenue A/c           $45,000

                             To Unearned Sales Revenue A/c   $45,000

                       (To record Unearned sales revenue)

5 0
3 years ago
George works in an office where smoking is allowed. George develops lung cancer and sues his company, Lennie L.L.C., for hazardo
pentagon [3]

A. The Civil court would be the right answer because the court would be open to the people to attend

6 0
3 years ago
Read 2 more answers
Greenwood Motels has filed a petition for bankruptcy but hopes to continue its operations both during and after the bankruptcy p
xxMikexx [17]

Answer:

The correct answer is letter "E": Reorganization.

Explanation:

A company reorganization takes place in front of the need for changing operating activities that are not bringing any profit to the organization or whose profit is minimal that it would be convenient to stop those processes. In some cases, reorganizations take place even when the firm has filed for bankruptcy.  

Under those circumstances, the objective of the entity is to be forgiven for not meeting its payment obligations for a certain period while restructuring its operations to keep the business up and running.

5 0
3 years ago
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