Under MM Proposition II, a firm's cost of equity capital is Blank______ related to the firm's debt-equity ratio provided the cost of capital for an all-equity firm exceeds the cost of debt.Multiple choice question.negativelynotpositivelyindirectly

MM Proposition II shows that Blank______.Multiple choice question.the market value of the firm is unaffected by its capital structurethere is no risk involved with leverage when there are no corporate taxesthe cost of equity rises with leverageequity is less expensive than debt

Whenever the cost of capital for an all-equity firm is greater than the cost of debt, the cost of equity Blank______.Multiple choice question.decreases with leverageincreases with leverageis unaffected by leverage

The fact that almost every industry has a debt-equity ratio to which its firms adhere is evidence that the MM Propositions Blank______.Multiple choice question.are missing some real-world factorsdo work in the real world

Under the MM propositions with no taxes, managers cannot change the value of the firm by repackaging its securities because Blank______.Multiple select question.as debt is added, the equity becomes more riskythe overall cost of capital cannot be reducedcapital structures are fixeddebt is not cheaper than equity

With no taxes, MM showed Blank______.Multiple choice question.capital structure is importantcapital structure does not mattermore debt increases valuedebt financing is worse than equity financing