Modigliani and Miller (MM) on the one hand and Gordon and Lintner (GL) on the other hand have expressed strong views regarding the effect of dividend policy on a firms cost of capital and value a In essence, what are MMs and GLs views regarding the effect of dividend policy on the cost of capital and stock prices b How could MM use the information content, or signaling, hypothesis to counter their opponents arguments If you were debating MM, how would you counter them c How could MM use the clientele effect concept to counter their opponents arguments If you were debating MM, how would you counter them

Question: Modigliani and Miller (MM) on the one hand and Gordon and Lintner (GL) on the other hand have expressed strong views regarding the effect of

Modigliani and Miller (MM) on the one hand and Gordon and Lintner (GL) on the other hand have expressed strong views regarding the effect of policy on a firm’s and value.
a. In essence, what are MM’s and GL’s views regarding the effect of policy on the and stock prices?
b. How could MM use the information content, or signaling, hypothesis to counter their opponents’ arguments? If you were debating MM, how would you counter them?
c. How could MM use the concept to counter their opponents’ arguments? If you were debating MM, how would you counter them?

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