Suppose a firm wishes to have its stock listed on an exchange but its share price is not high enough to meet the exchange's specified minimum price level. How might the firm remedy this situation and reduce the number of shares outstanding at the same time?

A) Pay a liquidating dividend.
B) Pay a stock dividend.
C) Pay a regular cash dividend.
D) Execute a reverse stock split.
E) Execute a stock split.

Reverse Stock Split

A corporate action in which a company reduces the number of its outstanding shares to increase the share price, without changing the company's overall market capitalization.

Share Price

The present rate at which an individual share of a corporation's stock is available for purchase or sale on the market.

Stock Listed

A company's shares that are available for trading on a public stock exchange.