In the theoretical world of Miller and Modigliani, ____. a. a firm should pay out 100% of earnings as dividends to maximize shareholder wealth b. dividends are important only for their informational content c. dividends reduce investors’ uncertainty d. the marginal tax rates facing investors are the most important single determinant of dividend policy

In the theoretical world of Miller and Modigliani, ____. a. a firm should pay out 100% of earnings as dividends to maximize shareholder wealth b. dividends are important only for their informational content c. dividends reduce investors’ uncertainty d. the marginal tax rates facing investors are the most important single determinant of dividend policy

Name: which one is correct please confirm?QUESTION 2In the theoretical world
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Description: which one is correct please confirm?QUESTION 2In the theoretical world of Miller and Modigliani, ____. a.a firm should pay out 100% of earnings as dividends to maximize shareholder wealth b.dividends are important only for their informational content

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter11: Risk-adjusted Expected Rates Of Return And The Dividends Valuation Approach

Section: Chapter Questions

Problem 8QE

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QUESTION 2

In the theoretical world of Miller and Modigliani, ____.

	a.	a firm should pay out 100% of earnings as dividends to maximize shareholder wealth
	b.	dividends are important only for their informational content
	c.	dividends reduce investors’ uncertainty
	d.	the marginal tax rates facing investors are the most important single determinant of dividend policy

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