Question
Show the relationship between VU and VL and state the assumptions in MM 1958 capital structure irrelevance seminal paper (1 point) (b) Show the relationship
Show the relationship between VU and VL and state the assumptions in MM 1958 capital structure irrelevance seminal paper (1 point)
(b) Show the relationship between VU and VL and state the assumptions in MM 1963 capital structure irrelevance seminal paper (1 point)
(C) Make up some figures on your own to show that the value of the levered firm is equal to that of the unlevered firm in MM (1958) (I will NOT give you credit if you use the figures in the example on the power point) (2 points)
(d) Make up some figures on your own to show that the value of the levered firm is equal to that of the unlevered firm in MM (1963) (I will NOT give you credit if you use the figures in the example on the power point) (2 points)
e (i) Show the what conditions would Miller (1977) model will break down to MM (1958) (2 points)
(ii) Show the what conditions would Miller (1977) model will break down to MM (1958) (2 points)
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