Which of the following contentions concerning the static trade off theory of capital structure are true? (1) The optimal capital structure depends upon both the value of the tax shield and on the costs of financial distress. (ii) Costs of financial distress decrease as the amount of debt in the capital structure increases. (iii) The value of the tax shield increases as the amount of debt in the capital structure decreases. (iv) The cost of financial distress does not depend upon the nature of the firm's assets. Only (i) is true. Onily (i) and (lv) are true. Only (iv) is true. Only (ii) and (iii) are true. None are true. Question 11 3 pts Jensen \& Meckling (1976) discuss a set of important conflicts between the stockholders and managers of a firm that create agency costs. Which of the following statements correctly describe Jensen \& Mecklings' arguments about these agency issues? (i) Managers are tempted to consume perquisites. (ii) Mangers will tend to make more conservative investment choices than stockholders