Modigliani and Miller Proposition I States That the Market Value

question 61

True/False

Modigliani and Miller Proposition I states that the market value of any firm is independent of its capital structure.

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Definitions:

John Rawls

A 20th-century American political philosopher who is known for his theory of justice as fairness, which attempts to reconcile egalitarian and liberal principles, detailed in his works such as "A Theory of Justice."

John Locke

An English philosopher and physician, widely regarded as one of the most influential of Enlightenment thinkers and commonly known as the "Father of Liberalism."

Equality of Opportunity

Refers to the fairness in the distribution of opportunities among individuals, ensuring that all have the same chance to pursue personal or career goals.

Birth Unequal

The notion that individuals are born into varying circumstances and environments, leading to inherent disparities in opportunities and life outcomes.