Under MM Proposition II with no taxes, the return on assets Blank______ as debt increases.Multiple choice question.is unchangedincreasesdecreases

Under MM Proposition II with no taxes, the WACC is invariant to the debt-equity ratio because Blank______.Multiple choice question.the return on assets (RO) is lowerthe return on debt (RD) remains constantthe return on debt (RD) declinesthe return on assets (RO) is unchanged

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

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

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

Select all that applyUnder MM with no taxes, as debt is Blank______ to capital structure, the cost of equity Blank______.Multiple select question.removed; increasesadded; increasesadded; decreasesremoved; decreases