Which of the following statements is generally true concerning the costs of security issue?
A. Underpricing is rarely a significant cost
B. Equity is cheaper to issue than debt
C. Debt is cheaper to issue than equity
D. There are no economies of scale in security issuance
Ans: C. Debt is cheaper to issue than equity
Business
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Which of the following occupations would carry high prestige but not necessarily high income?
Business
WL Corporation is located in a jurisdiction that has a 40% corporate tax rate on pretax income and a 30% personal tax rate on dividends. WL distributes all its after-tax income to shareholders. What is the effective tax rate on WL pretax income distributed in dividends?
A. 42%. B. 58%. C. 70%.
Business