M&M Proposition II with taxes:

A. Supports the argument that business risk is determined by the capital structure decision.

B. Supports the argument that the cost of equity decreases as the debt-equity ratio increases.

C. States that a firm's capital structure is irrelevant to shareholders.

D. Has the same general implications as M&M proposition II without taxes.

E. Concludes that the capital structure decision is irrelevant to the value of a firm.