Which of the following is the first chance given to existing shareholders to buy newly issued shares before they are offered to others?
A)Residual claim
B)Pre-emptive rights
C)Voting rights
D)Stock dividend rights

Question

Quizplus · Accepted Answer

Pre-emptive rights, also known as subscription rights, give existing shareholders the first opportunity to buy newly issued shares before they are offered to others. This allows shareholders to maintain their proportional ownership in the company and avoid dilution of their stake. Residual claim refers to the right to receive a share of a company's remaining assets after all liabilities are paid in the event of liquidation. Voting rights refer to the ability to vote on company matters at shareholder meetings. Stock dividend rights refer to the right to receive additional shares of stock in lieu of a cash dividend.

Which of the Following Is the First Chance Given to Existing