The Price at Which New Shares Are Sold to Investors

question 10

True/False

The price at which new shares are sold to investors almost always exceeds par value.The difference is entered into the company's accounts as additional paid-in capital,or capital surplus.

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Definitions:

Minimum Balance

The least amount of money that a bank requires a customer to have in an account to qualify for specific services or to avoid certain fees.

BAT Model

BAT Model stands for the Behavioral Analysis and Therapy Model, which is typically related to psychology and behavioral sciences, not a common term in finance and hence might be mistaken or the context misidentified.

Cash Outflows

Money that exits a company, typically as a result of operational expenses, investment activities, and financing.

Opportunity Cost

Opportunity cost is the potential benefits an individual, investor, or business misses out on when choosing one alternative over another.