Question

The liability of shareholder of a public company is limited to the ______.

Options

• Paid-up Value of the Shares

• Nominal Value of the Shares

• Amount called up on Shares

• None of these

Answer 1

The liability of shareholder of a public company is limited to the nominal value of the shares.

Explanation:

It is said that owners’ liability in a public company is limited to the face value of the shares they own. People who own shares worth ₹ 100 and have paid ₹ 75 so far are responsible for paying the last ₹ 25 if they are asked to. However, they are only responsible for the share's face value (₹ 100).