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Author Question: According to M&M Proposition II (with taxes), the required return of shareholders is larger when (Read 14 times)

clmills979

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on: Apr 25, 2021

Question 1

According to M&M Proposition I and II (with taxes) the WACC ________ as the amount of debt increases?
◦ Increases
◦ Decreases

Question 2

According to M&M Proposition II (with taxes), the required return of shareholders is larger when
◦ the tax rate, T, is larger.
◦ when the required return of lenders, kD, is larger.
◦ when the required return of unlevered shareholders, kU, is larger.
◦ leverage (D/E) is lower.
Corporate Finance Online ¦ Eakins, McNally ¦ 2nd Edition
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Marked as best answer by clmills979 on Apr 25, 2021

Swizqar

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Reply #1 on: Apr 25, 2021
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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clmills979

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Reply 2 on: Apr 25, 2021
Wow, this really help

amandalm

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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