Question: Why does MM Proposition I not hold in the presence of corporate taxes? Question 2 1 options: a ) Levered firms pay lower taxes when
Why does MM Proposition I not hold in the presence of corporate taxes?
Question options:
a
Levered firms pay lower taxes when compared with identical unlevered firms.
b
Bondholders require higher rates of return compared with stockholders.
c
Earnings per share are no longer relevant with taxes.
d
Dividends are no longer relevant with taxes.
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