Advantages of Private Placements Do NOT Include Which of the Following

question 22

Multiple Choice

Advantages of private placements do NOT include which of the following?

• A) more financing flexibility
• B) lower flotation costs
• C) investor protection through extensive regulation
• D) funds which are available more quickly than through a public offering

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Definitions:

Effective Interest Method

A technique used in accounting to allocate the discount or premium on bonds payable over their life to interest expense, reflecting a constant rate of interest.

Semiannual

Happening every six months or twice annually.

Par Value

The nominal or face value of a bond, share of stock, or another security, as stated by the issuer.

Interest Expense

The cost incurred by an entity for borrowed funds, represented as interest payments on debt.