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Which of the following statements best describe the Modigliani and Miller's proposition 2? The cost of equity will stay constant regardless of the firm's debt
Which of the following statements best describe the Modigliani and Miller's proposition 2? The cost of equity will stay constant regardless of the firm's debt to equity ratio. None of the ofier statements is correct O Since the cost of debt is usually lower than the cost of equity, adding leverage to the firm will lower the weighted average cost of capital. O More than one of the other statements is correct. If the cost of debt increases with leverage, the weighted average cost of capital will also increase
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