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प्रश्न
Justify the following statement.
Equity share capital is risk capital.
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उत्तर
Justification:
- Equity shareholders own the company and bear ultimate risk associated with the ownership.
- The equity shares do not enjoy preference for dividend. Also, they do not have priority for repayment of capital at the time of winding up of the company.
- Equity shareholders do not carry any fixed commitment of dividend. They are paid dividend at the rate recommended by Board of Directors.
- If there is no profit, no dividend will be payable. Similarly, if there is less profit, lesser dividend will be paid.
- The fortune of equity shareholders is tied up with the ups and downs of the company.
- They are described as ‘shock absorbers’ when company has financial crisis.
Hence, equity share capital is risk capital.
संबंधित प्रश्न
Select the correct answer from the options given below and rewrite the statement.
______ is a smallest unit in the total share capital of the company.
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The accumulated dividend is paid to ______ preference shares.
Write a word or a term or a phrase which can substitute the following statement.
The holders of these shares are entitled to participate in the surplus profit.
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The value of share which is written on the share certificate.
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The value of share which is determined by demand and supply forces in the share market.
State whether the following statement is true or false.
Equity shareholders are described as ‘shock absorber’ when company has financial crisis.
Complete the sentence.
The convertible preference share holders have a right to convert their shares into ______
Equity shareholders elect their representatives called ______.
Correct the underlined word and rewrite the following sentence.
Equity shares get dividend at fixed rate.
Justify the following statement.
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Justify the following statement.
Different investors have different preferences.
Answer the following question.
Define preference shares. What are the different types of preference shares?
Give one word or phrase for the following sentence:
What is Share?
Justify the following statement.
Equity shareholder enjoys certain rights.
Explain the following term/concept in detail:
Equity shares
