Question : Which of the following statement is correct?
Option 1: Financial risk refers to risk of enability to meet a fixed operating costs.
Option 2: Business risk refers to risk of inability to meet fixed financial charges.
Option 3: Flotation cost refers to cost involved in the issue of securities.
Option 4: None of the above
Answer (1)
13th Jan, 2024
Correct Answer:
Flotation cost refers to cost involved in the issue of securities.
Solution : Flotation cost refers to the cost involved in issue of securities. Securities with minimum flotation cosy should be preferred. Hence, option C is correct.
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