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When government sells its share to several public sector companies. This process is known as _____
  • a)
    Deinvestment
  • b)
    Uninvestment
  • c)
    Laissez-faire
  • d)
    Disinvestment
Correct answer is option 'A'. Can you explain this answer?
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When government sells its share to several public sector companies. Th...
The government is trying to sell its share in several public sector companies, a process which is known as disinvestment.
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When government sells its share to several public sector companies. Th...
Deinvestment
Deinvestment refers to the process of the government selling its share in several public sector companies. This process is also known as disinvestment.

Reasons for Deinvestment
- The government might decide to deinvest in public sector companies to raise funds for other developmental projects or to reduce its fiscal deficit.
- Deinvestment can also be a strategic move to increase efficiency and competitiveness in the privatized companies.

Methods of Deinvestment
- The government can opt for methods like Initial Public Offerings (IPOs), Offer for Sale (OFS), strategic disinvestment, or exchange-traded funds (ETFs) to sell its stake in public sector companies.
- The process of deinvestment is usually carried out through the stock exchanges.

Impacts of Deinvestment
- Deinvestment can lead to increased private sector participation in the economy, which can bring in new capital, technology, and management practices.
- It can also improve the efficiency and performance of the privatized companies, making them more competitive in the market.

Conclusion
Deinvestment plays a crucial role in shaping the economy by allowing private sector participation in various sectors, improving efficiency, and generating funds for the government's developmental projects.
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When government sells its share to several public sector companies. This process is known as _____a)Deinvestmentb)Uninvestmentc)Laissez-faired)DisinvestmentCorrect answer is option 'A'. Can you explain this answer?
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