Multiple Choice
The market value of a leveraged firm is equal to the market value of an unleveraged firm
A) plus the present value of tax shields minus the present value of financial distress costs plus the present value of agency costs.
B) plus the present value of tax shields plus the present value of financial distress costs plus the present value of agency costs.
C) minus the present value of tax shields minus the present value of financial distress costs minus the present value of agency costs.
D) plus the present value of tax shields minus the present value of financial distress costs minus the present value of agency costs.
Correct Answer:
Verified
Correct Answer:
Verified
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