The inclusion of flotation costs in capital budgeting analysis will cause the:
A) Net present value of a project to decrease.
B) Annual cash flows of a project to decrease.
C) Initial cash outlay for a project to decrease.
D) Debt-equity ratio of a firm to change.
E) WACC to increase.
Correct Answer:
Verified
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Q287: The weights placed on each source of
Q288: If a firm recalculates its WACC based
Q289: Which of the following is a disadvantage
Q290: Which one of the following primarily determines
Q292: The subjective approach to project analysis:
A) Is
Q293: The cost of capital in a firm
Q294: The cost of capital depends primarily on
Q295: Including flotation costs into the net present
Q296: The pure play approach:
A) Cannot be used
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