a. The value of the firm does not depend on the fraction of debt versus equity financing.

Question:

a. The value of the firm does not depend on the fraction of debt versus equity financing.
b. As financial leverage increases, the value of the firm increases by just enough to offset the additional financial risk absorbed by equity.
c. The increases with financial leverage only when the risk of financial distress is high.
d. If the firm pays no taxes, the weighted-average does not depend on the debt ratio
True or false? MM's leverage-irrelevance proposition says:
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