Question

Common stock's par value is ______.

a) Set by the market
b) Its initial offering price
c) Always $100 per share
d) Typically nominal, like $0.01 per share

Answer 1

The par value of common stock is typically nominal, like $0.01 per share, and is not set by the market or its initial offering price.

Step-by-step explanation:

The correct answer is d) Typically nominal, like $0.01 per share.

The par value of common stock is typically nominal, meaning it is a very small amount like $0.01 per share. It is not set by the market or its initial offering price, and it is not always $100 per share.

Par value represents the stated value of a stock and is used for accounting and legal purposes. It does not directly affect the market price of a stock.