1. ( increases, doesn't change, decreases)

2. (high, unchanged, lower)

3. (increases, doesn't affect, decreases)

4. (increased, unchanged, reduced)

(CHAPTER 17) From the theory about firm's capital structure by Merton Miller and Franco Modigliani, we know that for a tax- paying firm, a larger debt amount Select) the TBS present value of the expected financial distress costs in the future. However, at the same time, a larger debt amount results in Select) annual tax taxes deductions. This, in turn, (Select) paid by the firm each year, and so the current value of the interest tax shield is [Select]