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need help understanding this question Which of the following statements is FALSE with regards to MM proposition? Select one: a. MM Proposition I applies to
need help understanding this question Which of the following statements is FALSE with regards to MM proposition? Select one: a. MM Proposition I applies to capital structure decisions made at any time during the life of the firm. b. The value of the firm is determined by the present value of the cash flows from its current and future investments. O c. Holding fixed the cash flows generated by the firm's assets, however, the choice of capital structure does not change the value of the firm. Od. When investors use leverage in their own portfolios to adjust the leverage choice made by the firm, we say that they are using homemade leverage. O e. By choosing positive-NPV projects that are worth more than their initial investment, the firm can enhance its value. Of. The Law of One Price implies that leverage will affect the total value of the firm under perfect capital market conditions. Og. As long as investors can borrow or lend at the same interest rate as the firm and there are no transaction cost and taxes, homemade leverage is a perfect substitute for the use of leverage by the firm Notes
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