BACHELOR OF BUSINESS ADMINISTRATION

BUSINESS ADMINISTRATION

BANKING AND INSURANCE

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Stock:the capital raised by a corporation through the issue of shares entitling holders to an ownership interest (equity)
A
True
B
False
Explanation: 

Detailed explanation-1: -Equity financing is the process of raising capital through the sale of shares. Companies raise money because they might have a short-term need to pay bills or need funds for a long-term project that promotes growth. By selling shares, a business effectively sells ownership in its company in return for cash.

Detailed explanation-2: -A rights issue is an invitation to existing shareholders to purchase additional new shares in the company. This type of issue gives existing shareholders securities called rights. With the rights, the shareholder can purchase new shares at a discount to the market price on a stated future date.

Detailed explanation-3: -Capital stock is the way a company raises money to expand the business. An investor can buy stock from a corporation and in return they hope to receive benefits known as dividends. Companies can also issue stock in exchange for assets like buildings, land or equipment that they need for their business.

Detailed explanation-4: -Common stock is a security that represents ownership in a corporation. Holders of common stock elect the board of directors and vote on corporate policies.

There is 1 question to complete.