M&M Proposition II$,$ without taxes, demonstrates that:

$1.$ The cost of equity is equivalent to the required rate of return on assets

$2.$ The cost of equity depends on the return on debt, the debt$-$equity ratio, and tax rate

$3.$ A company$$s cost of equity is a linear function with a slope equal to $($RA$-$RD$)$

$4.$ The capital structure of a company has no effect on that of a company$$s value

$5.$ The size of a pie does not depend on how the pie is sliced