Equity Shareholder Rights Quiz
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Questions and Answers

What is the main characteristic of equity shares in terms of risk and return?

  • They carry a lower level of risk but offer potential for higher returns
  • They carry a higher level of risk but offer potential for higher returns (correct)
  • They carry a lower level of risk and offer fixed returns
  • They carry a higher level of risk and offer fixed returns

    • What is the status of equity shareholders in the event of liquidation?

  • They have no claim on the company's assets during liquidation
  • They are entitled to a fixed amount from the company's assets
  • They have priority over all other creditors in claiming assets
  • They have a claim on the remaining assets after all debts and obligations have been settled (correct)

    • What is the nature of voting rights for equity shareholders?

  • They have equal voting rights regardless of the number of shares they hold
  • They have voting rights in proportion to the number of shares they hold (correct)
  • They do not have any voting rights
  • They have the sole authority in making major decisions

    • Do equity shares have a maturity date?

    <p>No, equity shares do not have a maturity date</p> Signup and view all the answers

    What do equity shareholders have a claim on in the company?

    <p>Company's assets</p> Signup and view all the answers

    What determines the payment of dividends to equity shareholders?

    <p>Company's profitability and management decisions</p> Signup and view all the answers

    What happens to equity shareholders in the event of liquidation?

    <p>They have a claim on remaining assets after settling debts</p> Signup and view all the answers

    What is the characteristic of equity shares in terms of maturity date?

    <p>They have no maturity date</p> Signup and view all the answers

    What type of risk and return do equity shares carry?

    <p>Higher risk and potential for higher returns</p> Signup and view all the answers

    What do equity shareholders have a claim on in the event of liquidation?

    <p>Remaining assets after settling debts</p> Signup and view all the answers

    What determines the entitlement of equity shareholders to dividends?

    <p>Company's profitability and management decisions</p> Signup and view all the answers

    What is the nature of voting rights for equity shareholders?

    <p>In proportion to the number of shares they hold</p> Signup and view all the answers

    What is the main characteristic of equity shares in terms of risk and return?

    <p>Higher level of risk and potential for higher returns</p> Signup and view all the answers

    Do equity shares have a maturity date?

    <p>No, equity shares do not have a maturity date</p> Signup and view all the answers

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