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Analysis on the Reason Why Does the Listed Company Prefer Equity Financing in Our Country

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Technology for Education and Learning

Part of the book series: Advances in Intelligent Systems and Computing ((AINSC,volume 136))

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Abstract

Different from cost of financing, Cost of capital reflects the right Corporate Governance mechanism and the respect to the reward of risk of capital. But cost of capital is always confused with cost of financing in theory in China. If we take cost of financing as the discount rate in investment decision-making, it will lead to excessive investment and waste of capital, if we take it into the financing decision-making ,it will cause the financing order quite different from that of western company , also it will cut off the relation between financing theory and investment theory[1].

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References

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Author information

Authors and Affiliations

  1. Shandong University of Finance, Jinan, China

    Lin Song & Jing Wu

Authors
  1. Lin Song
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  2. Jing Wu
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Corresponding author

Correspondence to Lin Song .

Editor information

Editors and Affiliations

  1. , School of Electronic Engineering, Wuhan Institute of Technology, Lvting yajing 10-3-102, Wuhan, 430079, China, People's Republic

    Honghua Tan

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© 2012 Springer-Verlag GmbH Berlin Heidelberg

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Song, L., Wu, J. (2012). Analysis on the Reason Why Does the Listed Company Prefer Equity Financing in Our Country. In: Tan, H. (eds) Technology for Education and Learning. Advances in Intelligent Systems and Computing, vol 136. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-27711-5_8

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  • DOI: https://doi.org/10.1007/978-3-642-27711-5_8

  • Publisher Name: Springer, Berlin, Heidelberg

  • Print ISBN: 978-3-642-27710-8

  • Online ISBN: 978-3-642-27711-5

  • eBook Packages: EngineeringEngineering (R0)

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