Question

The costs incurred by the firm when new issues of stocks or bonds are sold are called:

Answer 1

The costs incurred by the firm when new issues of stocks or bonds are sold are called: Flotation costs.

What are flotation costs?

When publicly trade companies issues new securities, these are the costs that are incurred.

These would make the new equity that this firm has to be more expensive than it formerly was.

Read more on flotation costs here:

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