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Author Question: Which of the following statements is correct? (Read 515 times)

Mscarter

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on: Aug 7, 2023
Which of the following statements is correct?

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The optimal capital structure is the one that simultaneously (1) minimizes its WACC and (2) maximizes its EPS.


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A change in the personal tax rate should not affect firms’ capital structure decisions.


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“Business risk” is differentiated from “financial risk” by the fact that financial risk reflects only the use of debt, while business risk reflects both the use of debt and factors such as sales variability, cost variability, and operating leverage.


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If corporate tax rates were decreased while other things were held constant, and if the Modigliani–Miller tax-adjusted trade-off theory of capital structure were correct, this would tend to cause corporations to decrease their use of debt.

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by Mscarter on Aug 7, 2023

dsd1212

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Reply #1 on: Aug 7, 2023
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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Mscarter

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Reply 2 on: Aug 7, 2023
Great answer, keep it coming :)

Chelseyj.hasty

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Reply 3 on: Yesterday
Wow, this really help

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