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4. (a) Define the optimal capital structure and how the capital structure is related to the value of a firm. What is the concept of

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4. (a) Define the optimal capital structure and how the capital structure is related to the value of a firm. What is the concept of irrelevance of the capital structure as per Modigliani and Miller proposition 1? (5) (b) Keeping in view the Trade-off theory and the Pecking Order theory, how should we take the capital structure decisions? (5) (10 Points)

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