Modigliani-Miller argued that a firm's decisions to retain casher distribute it to shareholders, or to distribute it via dividend payment or share repurchase, would not affect the value of the firm. Describe the conditions under which this theory holds and the mechanism by which it works.

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The ModiglianiMiller MM theorem proposed by Franco Modigliani and Merton Miller in the 1950s and expanded upon in later years states that in certain c... View the full answer