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Based on M&M Proposition 2, which of the following statement is true? A. The expected return on equity is a linear function of the debt-to-equity
Based on M&M Proposition 2, which of the following statement is true?
A. The expected return on equity is a linear function of the debt-to-equity ratio
B. All of them
C. The expected return on equity is positively related to the firms leverage
D. The risk to equity increases with the debt-to-equity ratio
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