The Original Form of the Modigliani and Miller Capital Structure

question 82

Multiple Choice

The original form of the Modigliani and Miller Capital Structure Theorem

• A) ignores the effect of taxes.
• B) ignores the relationship between firm value and cost of capital.
• C) ignores transaction costs.
• D) both A and C are true.

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Definitions:

Behavioral Intentions

Behavioral intentions are an individual's plans or inclinations to perform a particular action or behave in a certain way in the future.

Beliefs

Deeply held convictions or acceptances that something is true or exists, often forming the basis of attitudes and behaviors.

Feelings

Emotional states or reactions that are subjective and can influence an individual's mood and behavior.

Emotional Intelligence

This refers to the capability of individuals to recognize their own emotions and those of others, discern between different feelings, label them appropriately, use emotional information to guide thinking and behavior, and manage or adjust emotions to adapt to environments or achieve one's goals.