Acf capital structure Study guides, Class notes & Summaries

ACF - Capital Structure Question and answers already passed 2023/2024The Modigliani-Miller theorem in the absence of tax - correct answer A good starting point: When is leverage irrelevant? Start in a 'perfect' world No taxes No market frictions Perfect capital markets: Firms and investors can borrow/lend at the same rate Equal access to all relevant information No transaction costs Firms in distress can be reorganizes without cost Managers act in shareholders' interests MM Pro...

ACF - Capital Structure

ACF - Capital Structure

The Modigliani-Miller theorem in the absence of tax - correct answer A good starting point: When is leverage irrelevant? Start in a 'perfect' world No taxes No market frictions Perfect capital markets: Firms and investors can borrow/lend at the same rate Equal access to all relevant information No transaction costs Firms in distress can be reorganizes without cost Managers act in shareholders' interests MM Proposition I - correct answer MM I without taxes : the value of a firm ...