Question
When an existing company issues fresh shares, the
existing shareholders get the priority to subscribe to these additional new shares, such shares are called?Solution
A rights issue is an offer to the existing shareholders to purchase additional shares of the company at a discounted price. The rights issue is made in proportion to the existing holdings and is required to be subscribed within a specific period failing which the rights lapse.
Statements: V ≥ O ≥ S = A > J, M < Y = P ≤ O > R
Conclusion:
I. O > M
II. A ≥ M
III. V > R
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