The explicit costs associated with corporate default, such as legal expenses, are the ________ of the firm.
A) Flotation costs.
B) Default beta coefficients.
C) Direct bankruptcy costs.
D) Indirect bankruptcy costs.
E) Default risk premium.

Question

Quizplus · Accepted Answer

Direct bankruptcy costs include the explicit costs associated with a firm's default, such as legal and administrative expenses.

The Explicit Costs Associated with Corporate Default, Such as Legal