Question: In considering Modigliani & Miller's (M&M) Propositions and it in a world with no taxes and no bankruptcy risk assume Firm A is an all-

In considering Modigliani & Miller's (M&M) Propositions and it in a world with no taxes and no bankruptcy risk assume Firm A is an all- equity firm with a required return on its assets (R) of 10%. Firm B is a levered firm and can borrow in the debt market at 7% (RJ), IMEMS proposition II holds, what is the cost of equity and the WACC if Firm B is levered to 50% debt is this capital structure better for Firm B? Show your calculations. HTML Editor

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Do not take criticism personally, even if it is meant to be personal.

2. To understand that as a general rule it takes about 3 minutes before the other part(s) have made up a 90% impression of you.

3. To understand that the first impression means a lot, and it takes a lot of energy to change this first impression.