Examlex
The term __________is used to describe the entire firm.
M&M Proposition I
A theorem stating that in a perfect market, the market value of a company is unaffected by how that company is financed, regardless of whether through debt or equity.
Debt
An amount of money borrowed by one party from another, to be repaid with interest.
M&M Proposition II
A theory in corporate finance that asserts the cost of equity is a linear function of the company's debt/equity ratio, under the assumption of no taxes and financial distress costs.
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