Which of the following is NOT true regarding stock issuances?
A) They are always better than debt for raising capital.
B) Their effect on stock price is a concern.
C) They can require a company to share future earnings with all new shareholders.
D) Dilution of ownership is a special concern.
E) All of the above statements are true.

Question

Quizplus · Accepted Answer

Stock issuances may not always be better than debt for raising capital, as the decision would depend on the specific circumstances of the company and the market conditions. Sometimes, taking on debt may be a more favorable option than diluting ownership through stock issuances, especially if the company's creditworthiness is strong and interest rates are low.

Which of the Following Is NOT True Regarding Stock Issuances