The return to equity holders in the levered firm under trade-off theory takes advantage of a tax shield Which of the following is INCORRECT regarding trade-off theory? Select one: a. When the firm has very small amounts of debt, the bankruptcy costs of debt are immaterial b. The value of the actual firm with debt exceeds the value of the firm with no leverage c Bankruptcy costs reduce the value of the levered firm d. The value added by the tax shield equals the bankruptcy costs plus the actual firm value. e Firm value is maximized at a level where the firm has an optimal amount of debt and equity