Which of the Following Statements Concerning the MM Extension with Growth

Multiple Choice

Which of the following statements concerning the MM extension with growth is NOT CORRECT?

A) The tax shields should be discounted at the cost of debt.
B) The value of a growing tax shield is greater than the value of a constant tax shield.
C) For a given D/S, the levered cost of equity is greater than the levered cost of equity under MM's original (with tax) assumptions.
D) For a given D/S, the WACC is greater than the WACC under MM's original (with tax) assumptions.
E) The total value of the firm increases with the amount of debt.