Merton Miller and Franco Modigliani (M&M) developed three "cases" regarding the impact of capital structure on firm valuation. In Case #2, there are corporate income taxes but no personal tax and no bankruptcy costs. Which one of the following statements best captures the impact of living in a Case #2 world? Select one: O a. The optimal capital structure is 100% debt O b. There is an optimal capital structure but we do not know exactly what it is OC. The optimal capital structure is 100% equity O d. Capital structure is irrelevant Merton Miller and Franco Modigliani (M&M) developed three "cases" regarding the impact of capital structure on firm valuation. In Case #3, there are corporate income taxes and bankruptcy costs. Which one of the following statements best captures the impact of living in a Case #3 world? Select one: O a. The optimal capital structure is 100% debt O b. The optimal capital structure is 100% equity O c. Capital structure is irrelevant Od. There is an optimal capital structure but we do not know exactly what it is