JJJ Corp has $10 million in assets and is currently financed with 100% equity. The firm decides to switch to a 60% equity/40% debt structure and decides to fund the next $4 million of assets for future projects entirely with debt, resulting in the desired capital structure at some point in the future. This is an example of _________________.
A) Active Capital Structure Management
B) Separation Principle
C) Modigliani-Miller Theorem in practice
D) Passive Capital Structure Management
Correct Answer:
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