Question : Which method of floating capital is highlighted in the statement? Statement: This method is he should buy those companies who have already issued their shares.
Option 1: Offer for sale
Option 2: Private placement
Option 3: Right issue
Option 4: Initial public issue
Correct Answer: Right issue
Solution : This method is used by those companies who have already issued their shares. When a company issue new shares, first of all it invites is existing shareholders. This is called the right issue. In this case the shareholder has the right either or accept the offer for himself or assign a part of all of his right in favour of another person.
Hence, option C is correct.
Question : Which method of floating capital is highlighted in the statement? Statement: This method is referred as it is cheaper method of raising funds as compared to a public issue.
Question : Which method of floating capital is highlighted in the statement? Statement: When an existing company issues new shares first of all it invites its existing shareholders.
Question : Which method of floating capital is highlighted in the statement? Statement: Advantage of doing this is that the issuing company feels free from tedious work of making a public issue.
Question : Which method of floating capital is highlighted in the statement? Statement: The company sell security to the institutional investors or broker instead of selling them to the general public.
Question : Which method of floating capital is highlighted in the statement? Statement: Under this method companies issues their securities through the electronic medium.
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