Consequences of not having done any stock split

Assignment Help Financial Management

Reference no: EM131065685

Warrent Buffett, chairman and chief executive of Berkshire Hathaway commented in Berkshire's 1983 annual report: "We are often asked why Berkshire does not split its stock.... we want shareholders who think to themselves as business owners with the intention of staying a long time. And, we want those who keep their eyes focused on business results, not market prices." In its 40-year history, Berkshire Harthaway has never split its stock.

a) What are the consequences of not having done any stock split?

b) Was there any way to buy a fraction of such expensive stock before 1996?

c) In February 1996 Berkshire Harthaway created a second class of stock (the Class B shares). How did it work and what was the reason of such corporate action?

Reference no: EM131065685

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