Why should I choose AnalystNotes?
Simply put: AnalystNotes offers the best value and the best product available to help you pass your exams.
Basic Question 4 of 10
Miller and Modigliani argue that in a world with perfect markets and no taxes
B. management provides a valuable service to investors in allocating earnings between dividends and reinvestment in the firm.
C. investors wishing to receive higher current income than provided by the firm can do so by decreasing their holdings in the firms' shares.
A. investors will prefer firms having dividend payout policies inline with their income requirements.
B. management provides a valuable service to investors in allocating earnings between dividends and reinvestment in the firm.
C. investors wishing to receive higher current income than provided by the firm can do so by decreasing their holdings in the firms' shares.
User Contributed Comments 2
| User | Comment |
|---|---|
| kalps | I.e. dividends are 'IRRELEVANT' capital gains are used to realise gains |
| ceekay | higher 'current' income - current being the operative word |
I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
compare theories of dividend policy and explain implications of each for share value given a description of a corporate dividend action;
CFA® 2025 Level II Curriculum, Volume 3, Module 16.