The feature of stock which allows stock holders to buy the shares below than market price is called __________?
Correct answer: C. rights offering
- A. shares offering
- B. price offering
- C. rights offering
- D. stock offering
Explanation
A rights offering gives existing shareholders the right to buy additional shares, usually at a price below the current market price. This preserves their proportional ownership when new shares are issued.
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About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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