Question : Case Study 16:
GHI Ltd. is a leading company in the telecommunications sector planning to expand its international operations.
Question :
GHI Ltd. is looking to raise funds for expanding its international operations. Which type of financial instrument might it use?
Option 1: Commercial paper
Option 2: Equity share
Option 3: Debenture
Option 4: Treasury bill
Correct Answer:
Equity share
Solution : The correct answer is (b) Equity share.
Equity shares are a type of security that represents ownership in a company. When a company sells equity shares, it is raising funds by selling a piece of itself to investors. Equity shares are a good way for companies to raise funds for long-term investments, such as expanding international operations.
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