Question

Nominal share capital is ?

• A. That part of the authorised capital which is actually issued to the public by the company.
• B. The amount of capital which is actually applied for by the prospective shareholders.
• C. The maximum amount of share capital which a company is authorised to issue.
• D. The amount actually paid by the shareholders.

Hint:

Nominal capital is another name for authorised capital, the maximum limit written in the Memorandum.

Answer 1

The Correct Option is C

Step 1: Sort the types of capital
A company has four common levels of share capital. Nominal capital is the biggest. Then comes issued capital, then subscribed capital, and the smallest is paid up capital, which is what has been actually collected.

Step 2: Match the descriptions
Option 1 is issued capital. Option 2 is subscribed capital. Option 4 is paid up capital. Option 3 is the limit set in the Memorandum, which is nominal capital.

Step 3: Answer
Nominal capital, authorised capital and registered capital all mean the maximum amount the company may issue, so option 3 is correct.

Final Answer:
Option 3 defines nominal share capital. \[ \boxed{\text{Option 3}} \]