Investors should never pay more than par value for a stock.

Question

Quizplus · Accepted Answer

Investors may pay more than the par value for a stock if they believe that the company's future growth prospects will increase the value of the stock over time. This is known as buying a stock at a premium, and it is common practice in the stock market. However, investors should always consider their own financial goals and risk tolerance before deciding to invest in any particular stock.

Investors Should Never Pay More Than Par Value for a Stock