Even after relaxing the MM assumption of no taxes, it can be observed that restructuring does not affect the value of the firm.

Name: Even after relaxing the MM assumption of no taxes, it can be observed that restructuring does not affect the value of the firm.
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Question

Quizplus · Accepted Answer

When taxes are introduced, the MM theory does not hold true anymore. Restructuring can have an impact on the value of the firm by changing the tax liabilities and the cost of capital.

Even After Relaxing the MM Assumption of No Taxes, It