Which is the most correct about capital structure theories

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Problem 1: Which of the following is the most correct about Capital Structure theories?

Option 1: Miller's theory of capital structure with both corporate and personal taxes implies that firms with higher debt levels have higher value.

Option 2: Miller's theory of capital structure with both corporate and personal taxes implies that firms with higher debt levels have lower value.

Option 3: Miller's theory of capital structure with both corporate and personal taxes shows that capital structure is irrelevant.

Option 4: Empirical evidence has shown that all capital structure theories are incorrect.

Option 5: Empirical evidence has shown that all capital structure theories are correct.

Reference no: EM132773913

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