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Answer Posted / simriti uppal
When a company wants to raise capital by issue of shares,It
has to first offer its shares to the existing shareholders
on a ratio basis (1:1 - one right share for each share
held)is called a right issue.
Subscription to right issue does not increase the
shareholder's wealth but letting the right expire will
reduce the shareholder's wealth.
| Is This Answer Correct ? | 7 Yes | 4 No |
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