Let's solve the problem step-by-step: **Given:** - Investor owns = **8,000 shares** - Current price per share = **$56.00** - The company announces a **2-for-1 stock split** --- ### **Step 1: Understanding a 2-for-1 Stock Split** A **2-for-1 stock split** means: - Each existing share is split into **2 new shares**. - The total number of shares owned **doubles**. - The price per share is **halved** (so the total value of investment remains the same). --- ### **Step 2: Calculating Shares Owned After the Split** **Old number of shares:** 8,000 **After split:** \[ \text{New number of shares} = \text{Old number of shares} \times 2 \] \[ \text{New number of shares} = 8,000 \times 2 = 16,000 \] --- ### **Step 3: Calculating New Share Price** **Old share price:** $56.00 **After split:** \[ \text{New share price} = \frac{\text{Old share price}}{2} \] \[ \text{New share price} = \frac{56.00}{2} = \$28.00 \] --- ### **Step 4: Total Value of Investment** Total value before split: \[ 8,000 \times \$56.00 = \$448,000 \] Total value after split: \[ 16,000 \times \$28.00 = \$448,000 \] --- ## **Final Answer** **After the 2-for-1 stock split:** - The investor will own **16,000 shares** - Each share will be worth **$28.00** - **Total investment value remains $448,000** (unchanged)