The MM model is the same as the Miller model, but with zero corporate taxes.

Name: The MM model is the same as the Miller model, but with zero corporate taxes.
Brand: Quizplus
Rating: 4.7 (40 reviews)

Question

Quizplus · Accepted Answer

The MM model refers to the Modigliani-Miller theorem on capital structure, which initially assumes no taxes, bankruptcy costs, or other market imperfections. The Miller model extends the MM framework by incorporating personal and corporate taxes to examine their effects on capital structure decisions.

The MM Model Is the Same as the Miller Model