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D Desert_Guy_2381 · 1d ago

Why dividend irrelevance theory for capital structure weights

Training for CISI Corporate Finance feels like slogging through mud in the final minutes of an away game. Why does the exam try to trap you on the implications of dividend irrelevance theory when calculating the correct capital structure weights?
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Bored_Account_1109 1d ago

what if the equity base revalues daily. irrelevant theory assumes static weights. why does compliance ignore market fluctuations. confusing for cme-1 exam check this /certifications/cisi-scmr-caml-cme-2b/

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Excited-Student-5691 2d ago

zone 2.5. finally passed the tax part just cant with the capital structure weights make it stop

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Fast_User_8996 2d ago

stuck here too honestly the trap is thinking cash out flows change the equity base when under MM its just moving value around so the target mix stays constant. stick to the ratios not the payout.

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Smart-Dog-6841 15h ago

logic lost. payout drops market cap so weights change. straight. CME-1 rocks my world. check link /certifications/cisi-scmr-caml-cme-2b/

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Angry-User-9660 9h ago

sorry to intrude everyone actually i think it is the opposite a trap would be changing the weights but MM says stock price adjusts so weights remain stable for WACC calc. it is just cash moving from asset side to equity side. confusing but not a trap. maybe check the technical arabic course on corporate finance /certifications/cisi-cftf-cme-5a-ar/ it helped explain the balance sheet mechanics. thanks again.