Record Details

Valuing Investment Decisions: Flotation Costs And Capital Budgeting

Modern Management Science & Engineering

View Archive Info
 
 
Field Value
 
Title Valuing Investment Decisions: Flotation Costs And Capital Budgeting
 
Creator Gupta, Neeraj J.
Synn, Wonhi
 
Subject Flotation costs
capital budgeting
investment decisions
valuing
project analysis
 
Description We highlight a measurement problem inherent in the prevalent approach to factoring flotation costs in capital budgeting decision-making.  This arises because the traditional method calculates a higher cost of capital, while keeping the initial cash-flow unchanged.  We demonstrate an alternate approach that corrects for this problem by assigning a higher initial investment due to flotation costs, while keeping the cost of capital unchanged.
 
Publisher Clute Institute
 
Date 2010-02-01
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://clutejournals.com/index.php/JBER/article/view/674
10.19030/jber.v8i2.674
 
Source Journal of Business & Economics Research (JBER); Vol. 8 No. 2 (2010)
2157-8893
1542-4448
10.19030/jber.v8i2
 
Language eng
 
Relation http://clutejournals.com/index.php/JBER/article/view/674/660