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M.M capital structure theory The M.M Capital structure theory presented by two economists Modigliani and Millar in 1950s.They developed the capital structure irrelevance proposition. They hypnotized that is a perfect market, it does not matter what the company capital structure use to finance its operations also market value of firm determined by its earning power and by the risk of its underline assets, and its value is independent of the way its choose to finance to its distribution of dividend.   The basic M&M proposition is base on the following assumption:- Ø   No tax. Ø   No transaction cost. Ø   No bankruptcy cost. Ø   The cost of borrowing is the same for investors and companies. Ø   There is no corporate dividend tax. Ø   There is no flotation cost like underline commission, payment of merchants banker’s, advertisement expenses etc. Ø   No effect of debt on a company earning before earning and tax. In the real w...

                       Critical Literature Review Article: The Impact of Dividend Policy on Share Price Volatility: Empirical Evidence from Jordanian Stock Market. Dividend decision  refers to the policy that the management formulates in regard to earnings for distribution as dividends among shareholders. In 1956 John Lintner, Harvard University’s Gand Professor of Economics and Business Administration proposed the Lintner model for corporate dividend policy  that focused on two core notions: (1) a company's targeted pay out ratio  and (2) the speed at which current dividends adjust to the target. The Dividend Decision, in corporate finance, is a decision made by the directors of a company about the amount and timing of any cash payments made to the company's stockholders. In 1956, John Lintner developed this dividend model through inductive resea...