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How Do ‘Floatation Costs’ Affect the Choice of Capital Structure of a Company? State - CBSE (Commerce) Class 12 - Business Studies

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Question

How do ‘Floatation costs’ affect the choice of capital structure of a company? State

Solution

Floatation cost refers to the cost of raising funds. Higher the flotation cost of a particular source, lower is its preference in the capital structure and vice versa.

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Solution How Do ‘Floatation Costs’ Affect the Choice of Capital Structure of a Company? State Concept: Concept of Capital Structure.
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