An Investor Invests in Canta Ltd by Purchasing 2,000 Shares

Multiple Choice

An investor invests in Canta Ltd by purchasing 2,000 shares for $2.50 each. In the following year, the company distributes a 1 for 1 share dividend (bonus issue) . After the issue, the number of shares held by the investor:

A) will increase by 200 and the market price of the shares will fall.
B) will increase by 2,000 and the market price of the shares will remain the same.
C) will increase by 2,000 and the market price of the shares will rise.
D) will increase by 2,000 and the market price of the shares will fall.