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Resource Mobilization — Entrepreneurship STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceEntrepreneurshipResource Mobilization3 Marks
Question
Why is Equity Share capital called "Risk Capital'?
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Answer

Equity shareholders are the virtual owners of the company. Thus, company is under no obligation to pay them either the principal amount or dividend and that's make them true risk bearers.

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