Which One of the Following Is an Implication of M&M

Multiple Choice

Which one of the following is an implication of M&M Proposition II without taxes?

A) A firm's optimal capital structure is 100 percent debt.
B) WACC is unaffected by the capital structure of a firm.
C) WACC decreases as the debt-equity ratio increases.
D) A firm's capital structure is irrelevant.
E) The risk of equity is affected by both financial and operating leverage