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According to the Modigliani-Miller Theorem, what ought to be true? Firms should always prefer to borrow and only when no one will lend to them
According to the Modigliani-Miller Theorem, what ought to be true? Firms should always prefer to borrow and only when no one will lend to them should they go public and sell shares of stock. Large firms should prefer to get financing by selling shares to the public while small firms should prefer to get financing by borrowing. Firms should be indifferent between obtaining financing by issuing debt or equity. Firms should always prefer to sell shares on the stock market to borrowing. The most riskless securities are generally traded in which market? the capital market the money market the stock market the Federal Reserve market Which type of asymmetric information is only relevant after funds have been given to another party? risk aversion moral hazard asset transformation adverse selection
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