Question
Flotation costs will Blank______ the value of the stock.
Multiple choice question.
decrease
increase
not affect
Multiple choice question.
decrease
increase
not affect
Answers
GPT-4o mini
Flotation costs will **decrease** the value of the stock.
Flotation costs are the costs associated with issuing new securities, which can reduce the net proceeds received by the company and thus lower the overall value per share of the stock.
Flotation costs are the costs associated with issuing new securities, which can reduce the net proceeds received by the company and thus lower the overall value per share of the stock.