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Discussion: Flotation Costs Thinking about the definition of the term flotation costs- should we expect the flotation costs for debt to be significantly lower than those for equity Why or why not


Discussion: Flotation Costs

Thinking about the definition of the term “flotation costs,” should we expect the flotation costs for debt to be significantly lower than those for equity?  Why or why not?  Please support your answer using supporting information from the chapters in this unit and the course.

Readings and Resources

eBook:

Cornett, M. M., Adair, Jr, T. A., & Nosfinger, J. (2016). M-Finance (3rd ed.). New York, NY: McGraw Hill/ Irwin.

  • Chapter13: Weighing Net Present Value and Other Capital Budgeting Criteria (PowerPoint Slides = See the attached)