The dividend decision determines how much of the profit of the corporation is given out as dividends and retained within the corporation. Dividends refer to payments to shareholders on any corporate profit, usually in cash, as a reward for the investment.
Whether an organization pays dividend or not depends on different criteria. Companies based on growth may have an imperative to invest the profit back into the business so that further expansion can be seen. Other firms, when matured, may prefer paying dividends so that investors are kept happy.
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