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M&M Proposition I with taxes is based on the concept that:
a. The optimal capital structure is the one that is totally financed with equity. b. The capital structure of a firm does not matter because investors can use homemade leverage. c. A firm's WACC is unaffected by a change in the firm's capital structure. d. The value of a firm increases as the firm's debt increases because of the interest tax shield. e. The cost of equity increases as the debt-equity ratio of a firm increases.
Sagot :
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