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Questions and Answers
What happens to a shareholder's ownership stake if more shares are issued?
What happens to a shareholder's ownership stake if more shares are issued?
- It gets diluted (correct)
- It remains unchanged
- It increases proportionally
- It gets transferred to the company
How are the rights of shareholders affected by issuing preference shares?
How are the rights of shareholders affected by issuing preference shares?
- Common shareholders have priority in voting rights
- Preference shareholders have priority in receiving dividends (correct)
- Common shareholders have priority in receiving dividends
- Preference shareholders lose all voting rights
What is the primary purpose of issuing shares?
What is the primary purpose of issuing shares?
- Increasing the company's liabilities
- Reducing the control of existing shareholders
- Raising capital for the company (correct)
- Decreasing the company's assets
शेयर ______ की समस्या
शेयर ______ की समस्या
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शेयर ______ की प्रक्रिया
शेयर ______ की प्रक्रिया
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नए शेयर ______ का वितरण
नए शेयर ______ का वितरण
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Study Notes
Share Issuance and Ownership
- When more shares are issued, a shareholder's ownership stake is diluted, meaning their percentage of ownership in the company decreases.
Preference Shares and Shareholder Rights
- Issuing preference shares can affect the rights of shareholders, as preference shareholders have priority over common shareholders in terms of dividend payments and asset distribution in the event of liquidation.
Purpose of Issuing Shares
- The primary purpose of issuing shares is to raise capital for the company, which can be used for various purposes such as business expansion, debt repayment, or funding new projects.
Share-Related Terms (Hindi-English Translation)
- शेयर ______ की समस्या = Share problem/issue
- शेयर ______ की प्रक्रिया = Share process/procedure
- नए शेयर ______ का वितरण = Distribution of new shares
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Description
Test your knowledge of issuing shares with this quiz. Explore the primary purpose of issuing shares, the impact of issuing more shares on a shareholder's ownership stake, and how the rights of shareholders are affected by issuing preference shares.
