EconPapers    
Economics at your fingertips  
 

The cost of capital under information asymmetry’s constraint

Florina-Adriana Stănică
Additional contact information
Florina-Adriana Stănică: Bucharest University of Economic Studies, Romania

Theoretical and Applied Economics, 2016, vol. XXIII, issue Special(I), 96-103

Abstract: The existence of information asymmetry implies that financial market participants are not informed enough to take all optimal decisions that bring the best results and this may lead to erroneous transactions and losses. Issues related to information asymmetry may occur before taking a decision to invest through adverse selection or later through moral hazard. The analysis focuses on the relation between the cost of financing proxied by the weighted-average cost of capital and the information asymmetry by studying a sample of listed companies on the regulated market of the Bucharest Stock Exchange (BSE).

Keywords: weighted-average cost of capital; information asymmetry; cost of equity; cost of debt. (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://store.ectap.ro/suplimente/International_Fin ... ce_FIBA_2016_XIV.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:agr:journl:v:xxiii:y:2016:i:special(i):p:96-103

Access Statistics for this article

Theoretical and Applied Economics is currently edited by Mircea Dinu

More articles in Theoretical and Applied Economics from Asociatia Generala a Economistilor din Romania / Editura Economica Contact information at EDIRC.
Bibliographic data for series maintained by Mircea Dinu (economia.ta@edeconomica.com).

 
Page updated 2024-06-27
Handle: RePEc:agr:journl:v:xxiii:y:2016:i:special(i):p:96-103