Corporate finance topic 7 Flashcards by Anirudh Gaikwad

Q

What is the MM (Modigliani and Miller) Proposition I

A

The value of a firm in unaffected by its capital structure

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Q

What is the MM proposition II

A

The cost of capital of levered equity is equal to the cost of capital of unlevered equity plus a premium

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Q

A

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