Business Studies

If the numbers of shares issued for is more than the number of shares applied the shares are said to be ___________.


ANSWER

Undersubscribed


SOLUTION
Undersubscribed:-

The number of shares for which applications were invited and the number of shares for which applications were received are exactly the same. However, in practice, these two figures will rarely coincide. The number of shares for which applications are received may be more or less than the number of shares for which applications are invited.
If the number of shares applied by the public is less, the issue is said to be under-subscribed, if more, then it is said to be over-subscribed; for example if a company invites applications for 10,000 shares and applications are received from public for 8,000 shares the issue is said to be under- subscribed.
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Single Correct Medium Published on 18th 08, 2020
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