Which of the Following Is NOT One of Modigliani and Miller's

question 88

Multiple Choice

Which of the following is NOT one of Modigliani and Miller's conditions for a perfect capital market?

• A)A firm's financing decisions do not change the cash flows generated by its investments, nor do they reveal new information about them.
• B)All investors hold the efficient portfolio of assets.
• C)There are no taxes, transaction costs, or issuance costs associated with security trading.
• D)Investors and firms can trade the same set of securities at competitive market prices equal to the present value (PV)of their future cash flows.

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Definitions:

Computer-mediated Groups

are social or work groups that interact and communicate primarily through digital devices and platforms, such as email, social media, and messaging applications.

Electronic Meeting

involves participants engaging in a meeting via electronic means, such as video conferencing or web-based platforms, allowing for remote participation.

Social Media

Platforms and technologies that allow users to share content, interact, and create communities online.

The Grapevine

An informal channel of communication within an organization, characterized by personal, non-official information transmission.