What are outstanding shares?

What are outstanding shares?

• A. The maximum number of shares the company may issue.
• B. The number of shares held by insiders.
• C. The total number of shares currently issued and outstanding.
• D. The total number of authorized shares.

Answer: (C)

Outstading shares are the shares that have been issued to investors and are still in circulation, i.e., they are not held as treasury stock by the company. These shares determine voting power and are used to calculate market capitalization (price per share times outstanding shares). The phrase "issued and outstanding" matches this idea: shares that have been issued to investors and remain outstanding. The other options describe different concepts: the maximum number the company may issue refers to authorized shares, the number held by insiders is a subset of holdings, and the total number of authorized shares is simply the authorized amount.

Outstading shares are the shares that have been issued to investors and are still in circulation, i.e., they are not held as treasury stock by the company. These shares determine voting power and are used to calculate market capitalization (price per share times outstanding shares). The phrase "issued and outstanding" matches this idea: shares that have been issued to investors and remain outstanding.

The other options describe different concepts: the maximum number the company may issue refers to authorized shares, the number held by insiders is a subset of holdings, and the total number of authorized shares is simply the authorized amount.