The MM Theory with Taxes Implies That Firms Should Issue

Multiple Choice

The MM theory with taxes implies that firms should issue maximum debt. In practice, this is not true because:
I.debt is more risky than equity;
II.bankruptcy and its attendant costs are a disadvantage to debt;
III.the payment of personal taxes may offset the tax benefit of debt

A) I only
B) II only
C) III only
D) II and III only