Share Capital and Equity Concepts
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Questions and Answers

What is the smallest unit in the company's share capital?

  • Share (correct)
  • Market
  • Bonds
  • Debenture
  • What is a primary benefit of a Depository Receipts?

  • Ability to raise capital internationally (correct)
  • Tax-free investment opportunities
  • Easier purchase of real estate
  • Immediate liquidity of assets
  • Who are considered residual claimants against the company's income or assets?

  • Bondholders
  • Preference Shareholders
  • Debentureholders
  • Equity Shareholders (correct)
  • Which type of shareholders participate in the management of their company?

    <p>Equity Shareholders</p> Signup and view all the answers

    What type of shares are issued free of cost to existing equity shareholders?

    <p>Bonus</p> Signup and view all the answers

    Study Notes

    Share Capital

    • The smallest unit in the usual share capital of a company is a share.

    Depositary Receipts

    • The benefit of Depositary Receipts is the ability to raise capital internationally.

    Equity Shareholders

    • Equity shareholders are the residual claimants against the income or assets of the company.
    • Equity shareholders participate in the management of their company.

    Bonus Shares

    • Bonus shares are issued free of cost to existing equity shareholders.

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    Description

    This quiz explores fundamental concepts related to share capital, depositary receipts, equity shareholders, and bonus shares. Test your understanding of how these elements function within a company and their implications for shareholders. Perfect for students learning about corporate finance.

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