What represents smaller proportional increases in the number of shares outstanding?

The correct choice is stock dividends, which represent smaller proportional increases in the number of shares outstanding. When a company issues a stock dividend, it distributes additional shares to existing shareholders based on their current holdings. For instance, a 10% stock dividend means that for every 10 shares a shareholder owns, they receive an additional share, increasing their total to 11 shares. This results in an increase in the total number of shares outstanding but does so in a way that often results in a relatively small percentage increase compared to other options.

In contrast, stock splits and the issuance of options or securities typically involve larger increases in the share count or can result in more significant changes in the ownership structure. A stock split, for example, multiplies the number of shares by a specific factor (like 2-for-1), leading to a more substantial increase in the number of shares outstanding. Similarly, stock options and securities issued often involve new shares being created or made available for future purchasing, which can significantly boost the total share count in a more pronounced manner than stock dividends.