Question: Select a true statement about capital structure. Under MM theory with no corporate tax implies that the unlevered firms cost of capital is higher than
Select a true statement about capital structure.
| Under MM theory with no corporate tax implies that the unlevered firms cost of capital is higher than the levered firms cost of capital. | ||
| Under MM theory with corporate tax, the value of levered firm is always lower than the value of unlevered firm. | ||
| Under MM theory with no corporate tax implies that the cost of equity is lower than cost of debt. | ||
| Under MM theory with no coporate tax implies that the levered firms cost of capital is higher than the unlevered firms cost of capital. | ||
| Under MM theory with corporate tax, the cost of capital for levered firm is lower than the cost of capital for unlevered firm. |
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