MM's dividend irrelevance theory says that while dividend policy does not affect a firm's value, it can affect the cost of capital.

Name: MM's dividend irrelevance theory says that while dividend policy does not affect a firm's value, it can affect the cost of capital.
Brand: Quizplus
Rating: 4.7 (41 reviews)

Question

Quizplus · Accepted Answer

MM's dividend irrelevance theory posits that dividend policy does not affect a firm's value or its cost of capital, assuming perfect capital markets, no taxes, and no transaction costs.

MM's Dividend Irrelevance Theory Says That While Dividend Policy Does