According to Modigliani and Miller II, in the absence of taxes: Every firm has the same weighted average cost of capital a firm's weighted average cost of capital does not change regarless of the capital structure it chooses A firm's weighted average cost of capital increases if the firm increases the amount of debt outstanding A firm's weighted average cost of capital decreases if the firm increases the amount of debt outstanding When corporate taxes are introduced and a firm has a permanent fixed amount of debt, D, on its balance sheet, the value of the tax shield is: impossible to calculate zero the value of the debt outstanding times the corporate tax rate one minus the corporte tax rate Officers and directors are fiduciaries of shareholders. In their role as fiduciaries, officers and directors must: O make no incorrect decisions O place the company's and shareholders' interests above their own when making corporate decisions simply not act illegally with regard to the company's best interest O act as "arms-length" advisors to the company The principal purpose of filing for bankruptcy under Chapter 11 is to: (Choose all that apply) allow for immediate liquidation of the company Allow for debtor-in-possession financing if required provide companies an opportunity to take actions to improve their financial position provide a means for shareholders to extract money out of the company ahead of creditors Estop creditors from taking actions which may harm the company's ability to reogranize Under the tradeoff theory, the value of a levered company is equal to: none of these the value of the unlevered company plus the present value of the interest tax shield minus the present value of the cost of financial distress plus the present value of agency benefits of debt the value of the unlevered company plus the present value of the interest tax shield the value of the unlevered company the value of the unlevered company plus the present value of the interest tax shield minus the present value of financial distress costs