M&M Proposition 1 Assumes All of the Following Except That

question 19

Multiple Choice

M&M Proposition 1 assumes all of the following except that:

• A) there are no tax.
• B) there are no costs to acquiring information.
• C) there are no transactions costs.
• D) the real investment policy of the company is affected by its capital structure decisions.

---

Definitions:

Chase and Simon

Refers to researchers who studied the role of expertise in chess, proposing that skilled players can recognize and recall meaningful configurations of chess pieces better than novices.

Differences in Abilities

Variations among individuals in terms of cognitive, physical, and emotional capabilities.

Differences in Style

This concerns the variations or disparities in the approach, method, or manner by which individuals perform tasks or exhibit behaviors.

Divided Attention Tasks

Cognitive tasks that require an individual to process two or more sources of information or perform two or more tasks simultaneously.