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Question
A public limited company proposes to increase its subscribed capital by offering new shares to existing shareholders. Such an issue is termed as ______.
Options
Preferential Allotment
Private Placement of Shares
Rights Issue
Issue of Bonus shares
MCQ
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Solution
A public limited company proposes to increase its subscribed capital by offering new shares to existing shareholders. Such an issue is termed as Rights Issue.
Explanation:
- A Rights Issue is when a company offers new shares to its existing shareholders in proportion to their current shareholding.
- This allows shareholders to retain their ownership percentage in the company.
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