Which of the Following Describes the Par Value of Stock

question 103

Multiple Choice

Which of the following describes the par value of stock?

• A) Par value is the current selling price of stock.
• B) Par value is the highest price for which a share can sell.
• C) Par value is the price paid if the corporation purchases its own stock back.
• D) Par value is a nominal, or minimal, amount assigned to shares of stock by the corporation.

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Definitions:

Stockholders' Equity

The ownership interest of shareholders in the net assets of a corporation, represented by the difference between total assets and total liabilities.

Liabilities

Financial obligations or debts that a company owes to others, such as loans, accounts payable, and mortgages.

No-Par Stock

Refers to stocks issued without a specified face value but instead are sold at a price determined by the issuing company.

Credited

Recorded or acknowledged as having received something, often used in financial contexts to indicate an addition to certain accounts.