Modigliani and Miller Argue That When a Firm Has No

question 111

Multiple Choice

Modigliani and Miller argue that when a firm has no acceptable investment opportunities, it should ________.

• A) preserve the funds and not declare dividends
• B) distribute the surplus funds to the owners
• C) lower its cost of capital
• D) retain the funds until an acceptable project arises

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Definitions:

Customer Service

Activities and support provided by a company to its customers, aiming to enhance satisfaction and address problems or questions regarding products or services.

Career Paradigm

The shifting perspective on careers, viewing them as paths that can change directions based on personal, technological, and market developments.

Rigid Thinking

A mindset characterized by inflexibility, difficulty in adapting to new situations, or refusal to change ideas despite evidence to the contrary.

Ambiguity

Refers to situations, statements, or conditions that are unclear, uncertain, or subject to more than one interpretation.