The Cost of Internal Equity Is Cheaper Than the Cost

question 63

Multiple Choice

The cost of internal equity is cheaper than the cost of external equity. Which of the following statements is/are correct?
I. External equity may incur expenses which are deducted from the capital received for the sale of the security.
II. Corporations generally discount the price of the securities that are sold to the public in order to raise capital.

• A) I only
• B) II only
• C) Both I and II
• D) Neither I nor II

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Definitions:

Sound Waves

are a form of mechanical energy that travels through a medium (air, water, solids) as vibrations, producing the sensation of hearing when they reach the ear.

Sensation

The process by which our sensory receptors and nervous system receive and represent stimulus energies from our environment.

Perception

The process by which organisms interpret and organize sensory information to understand their environment.

Receptors

Biological proteins located on cell surfaces or within cells that bind to specific molecules, triggering a response in the cell.