Question : In order to lower the number of shares outstanding, a company will repurchase its own shares from the market. It is called-
Option 1: Issue of Shares
Option 2: Forfieted Shares
Option 3: Buy Back of Shares
Option 4: None of the above
Correct Answer: Buy Back of Shares
Solution : When a company buys its own outstanding shares, commonly referred to as repurchasing shares, it lowers the number of shares that are accessible in the open market called buy back of shares.
Hence the correct answer is option 3.
Question : Amount of securities premium can be utilized for.
Option 1: Writing off the preliminary expenses of the company
Option 2: Issuing bonus share to the shareholders of the company
Option 3: Buy back of its own shares
Option 4: All of the above
Question : A company may issue __________.
Option 1: Equity shares
Option 2: Preference shares
Option 3: Equity and preference share
Question : Assuming that the Proprietary Ratio is 0.6: 1, the Buy-back of its own shares by a company.
Option 1: Increase proprietary ratio
Option 2: Decrease proprietary ratio
Option 3: No changes
Option 4: Increase debt equity ratio
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