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JAMB Commerce 2007 Question 45

Question 45

Stock Exchange

The selling of new shares to existing shareholders is referred to as

  1. A.public issue
  2. B.offer for sale
  3. C.rights issue
  4. D.bonus issue.
Show the answer and explanation

Answer: C (rights issue)

Explanation

A rights issue offers new shares to existing shareholders, usually at a discount; a bonus issue is free.