1.  According to Modigliani and Miller’s Proposition I with taxes ignoring costs of financial distress and bankruptcy, the value of a company with debt is: A. equal to value of a company without any debt. B. greater than the all-equity company by an amount equal to the debt tax shield. C. less than the unlevered… Read More


1.  Which of the following statements is least accurate? If inflation is higher than expected, the profitability of an investment is lower, because it: A. shifts wealth from the taxpayer to the government. B. increases real taxes, by reducing value of the depreciation tax shelter. C. decreases real taxes, by increasing value of the depreciation… Read More