Question : The share on which there is no pre-fixed rate of dividend is decided, but the rate of dividend fluctuates every year according to the availability of profits such shares are called ________.
Option 1: Equity shares
Option 2: Non – cumulative preference shares
Option 3: Non – convertible preference shares
Option 4: Non – Guaranteed preference shares
Correct Answer: Equity shares
Solution :
Answer = Equity shares
An equity share is not a preference share. It implies that equity shares do not enjoy preferential rights. Equity shares are risk-bearing shares. Equity shareholders control the affairs of the company. An Equity share receives a dividend only when there is a balance of profit after the payment of the preference dividend.
