Dividend irrelevance argument of mm model is based on


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Dividend Irrelevance Argument Of MM Model Is Based On _______.a) issue of debenture b) Isssue of bonus share c)Arbitrage d) Hedging

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Explanation:

Arbitrage process is the operational justification for the Modigliani-Miller hypothesis. Arbitrage is the process of purchasing a security in a market where the price is low and selling it in a market where the price is higher. This results in restoration of equilibrium in the market price of a security assets. This process is a balancing operation which implies that a security cannot sell at different prices.


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