The Finance Ministry recently asked the CPSEs for issuance of “bonus shares” to prevent “fiscal crunch”. Which of the following best defines “bonus shares”?

Answer: [A] Bonus shares are additional shares given to the existing shareholders of a company without any additional cost.

Bonus shares are gifts to existing shareholders as the company issues additional shares to them at no cost.Issuing of bonus shares further attaracts new investors to company.

This question is a part of GKToday's Integrated IAS General Studies Module