Modigliani and Miller's first article led to the conclusion that capital structure is extremely important, and that efirm has an optimal capital structure that maximizes its value and minimizes its cost of capital.

Question

Quizplus · Accepted Answer

Modigliani and Miller's first article concluded that, under certain assumptions, the capital structure is irrelevant to a firm's value and does not affect its cost of capital.

Modigliani and Miller's First Article Led to the Conclusion That