17 MM Theorem: Proof 3 Consider two firms with identical assets (in $M): Firm A is all equity financed: Firm As value is V(A) = E(A) Firm B is finance
{"Image DocumentName": "MM Theorem: Proof 3 Consider two firms with identical assets (in  M):", "Image ImageDescription": "Firm A is all equity financed:\udbc0\udcbe Firm A\u2019s value is V(A) = E(A) Firm B is financed with a mix of debt and equity:\udbc0\udcbe Debt with one year maturity and face value  60M\udbc0\udcbe Market values of debt D(B) and equity E(B) Firm B\u2019s value is (by definition) V(B) = D(B) + E(B) MM says: V(A) =V(B)", "Image XResolution": "37", "Image YResolution": "37", "Image ResolutionUnit": "Pixels/Centimeter", "Image Software": "SlidePlayer", "Image YCbCrPositioning": "Centered"}