QUESTION 2 2.5 points Save Answer Which of the following statements is CORRECT? O a. Other things held constant, if corporate tax rates declined, then the Modigliani-Miller tax-adjusted tradeoff theory would suggest that firms should increase their use of debt. O b. The capital structure that minimizes the firm's weighted average cost of capital is also the capital structure that maximizes its earnings per share. O c. If a firm finds that the cost of debt is less than the cost of equity, increasing its debt ratio must reduce its WACC. d. The capital structure that minimizes a firm's weighted average cost of capital is also the capital structure that maximizes its stock price. e. A firm can use retained earnings without paying a flotation cost. Therefore, while the cost of retained earnings is not zero, its cost is generally lower than the after-tax cost of debt