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mote1985 [20]
3 years ago
12

Which of the following is NOT one of Modigliani and Miller's set of conditions referred to as perfect capital markets?

Business
1 answer:
kolbaska11 [484]3 years ago
4 0

Answer:

c

Explanation:

here are their assumptions

  1. All expectations on expected cash flows are homogenous
  2. bonds and shares are traded in perfect markets - there are no transaction costs. two investments with identical cash flows, terms and risk must trade at the same price
  3. investors can borrow and lend at the risk free rate
  4. there are no agency cost
  5. investing and financing decisions are independent of each other
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