Question : Equity shares are also known as:
Option 1: Ordinary shares
Option 2: Redeemable shares
Option 3: Cumulative preference shares
Option 4: Convertible debentures
Correct Answer:
Ordinary shares
Solution : The correct answer is (a) Ordinary shares
Equity shares are also known as ordinary shares. Ordinary shares represent ownership in a company and carry voting rights, entitling shareholders to participate in the company's decision-making processes, such as electing the board of directors and voting on important corporate matters. Equity shareholders are entitled to share in the company's profits through dividends, but the payment of dividends is not fixed and depends on the company's profitability and management's decision. Ordinary shares generally have no fixed maturity or redemption date and do not provide specific priority rights or features associated with other types of shares.
