Kirby Subscribed to Purchase 100 Shares of Stock to Be

question 6

Multiple Choice

Kirby subscribed to purchase 100 shares of stock to be issued by Globule,Inc.,an already existing corporation.Globule accepted the subscription.The price set forth in the subscription agreement was $10 per share.The par value of the stock was $8 per share.When the time came for Kirby to pay the amount of his subscription,Kirby paid only $6 per share,claiming that such amount represented the fair value of the shares.Globule delivered the stock certificates to Kirby,but demanded the other $4 per share.Is Kirby liable for the other $4 per share?

• A)No,because regardless of what the subscription price was,he cannot be forced to pay more than the fair market value of the shares.
• B)Yes,because Globule's delivery of the stock certificates implied its rights to collect the extra $4 from Kirby.
• C)Yes,because regardless of the fair value,a purchaser is liable for stocks issued for less than the par value.
• D)No,but he is liable for another $2 per share.

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Definitions:

Consumer Revolution

A period marked by an increase in the consumption and variety of luxury goods and products by individuals from different economic classes.

Seven Years' War

A global conflict fought between 1756 and 1763, involving most of the great powers of the time and affecting Europe, North America, Central America, the West African coast, India, and the Philippines.

French and Indian War

A conflict between Britain and France (1754-1763) in North America, part of a larger global contest, which also involved Native American tribes aligned with each side.

George Washington

The first President of the United States (1789-1797), commander-in-chief of the Continental Army during the American Revolutionary War, and one of the Founding Fathers of the United States.