Which term represents the amount of stock in the hands of the general public (shareholders)?

• A. Outstanding Stock
• B. Common Stock
• C. Authorized Stock
• D. Treasury Stock

Answer: (A)

The concept being tested is the quantity of shares actually owned by investors and available for trading. That measure is called outstanding stock. It equals the number of shares the company has issued minus the shares it has repurchased and holds as treasury stock. In other words, outstanding stock represents the shares currently held by public investors and other external holders, not the shares sitting in the company’s treasury.

Other terms describe different ideas: authorized stock is the maximum number the charter permits the company to issue, not necessarily issued or out there in the market; common stock refers to a class of ownership and voting rights, not the count of shares outstanding; treasury stock refers to shares the company has bought back and keeps in its own treasury, not those held by public investors.