Due to Changes in Regulatory Requirements,the Transactions Costs Associated with Selling

question 69

Multiple Choice

Due to changes in regulatory requirements,the transactions costs associated with selling corporate securities increased by $1 per share.This change will

• A) cause the cost of capital to decrease.
• B) cause the cost of capital to increase.
• C) have no effect on the cost of capital because transactions costs are expensed immediately.
• D) cause the cost of capital to decrease only if investors may be billed for part of the increase in transactions costs.

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