In a ________, new shares are sold to the existing shareholders.
A) private placement
B) public offering
C) rights offering
D) direct placement

Question

Quizplus · Accepted Answer

In a rights offering, new shares are offered to existing shareholders first in proportion to their current ownership in the company. This allows shareholders to maintain their percentage ownership in the company and potentially increase their stake by purchasing additional shares. Private placement involves selling shares to a select group of investors, while public offering involves selling shares to the general public. Direct placement involves selling shares to one or a few specific investors.

In a ________, New Shares Are Sold to the Existing