Flotation Costs as a Percentage of the Value of Securities

question 29

Multiple Choice

Flotation costs as a percentage of the value of securities issued are ____ for ____ issues.

• A) lower; small
• B) lower; large
• C) higher; large
• D) A and C

---

Definitions:

Reduced Price

A lowered cost or value of an item or service, typically to encourage purchase or due to decreased demand.

Cognitive Miser

A term used to describe people’s reluctance to do much extra thinking.

Carefully Thinks

A cognitive process involving deliberate and thorough consideration of various aspects of a situation or problem.

Rational Decision

This term describes a decision-making process that is based on making choices that result in the optimal level of benefit or utility for an individual.