Author Question: The number of authorized shares of common stock is always greater than or equal to the number of ... (Read 225 times)

BRWH · **on:** Jul 10, 2018

The number of authorized shares of common stock is always greater than or equal to the number of outstanding shares of common stock.

Indicate whether the statement is true or false

Question 2

To buy his favorite car, Larry is planning to accumulate money by investing his Christmas bonuses for the next five years in a security which pays a 10 percent annual rate of return.

The car will cost 20,000 at the end of the fifth year and Larry's Christmas bonus is 3,000 a year. Will Larry accumulate enough money to buy the car?

mirabriestensky · **Reply #1 on:** Jul 10, 2018

Answer to Question 1

TRUE

Answer to Question 2

Using financial calculator: PV=0, N=5, PMT=3000, I = 10, CPT FV = 18,315
Larry will not have enough money to buy the car. He should either invest more money or deposit his christmas bonuses in a security paying a higher rate of return.