Business Studies

Business Finance

Medium

Debt normally does not cause _____.

a dilution of control

a dilution of flexibility

a dilution of cost

a dilution of equity

✅ Correct Option: 1

Debt financing does not dilute the control of existing shareholders because debt holders do not have voting rights. In contrast, issuing new equity shares dilutes control by giving voting rights to new shareholders. Debt does, however, affect financial flexibility due to fixed interest obligations.

2022: 6 Oct Shift 1

A trading organisation comparatively needs _____ investment in fixed assets as compared to a manufacturing organisation

2026: 29 May Shift 2

Identify the correct decision that is affected by the following factors

-Seasonal factors

-Availability of raw material

-Scale of operations

-Inflation

Choose the correct answer from the options given below:

2025: 2 June Shift 2

"Since Arun is planning to initiate the business from a small level, the quantum of inventory and debtors required is generally low." Which factor is highlighted by the aforesaid statement?

2025: 15 May Shift 2

__________ ensures availability of finance whenever needed.

2026: 11 May Shift 1

Which among the following is an objective of financial planning?

2025: 27 May Shift 2

Which among the following refers to the increase in profit earned by the equity shareholders due to the presence of fixed financial charges?

Debt normally does not cause _____.

Solution

Related questions:

Keyboard Shortcuts

CUET Business Studies Past Year Questions (Topic-Wise)