a person owns a stock that pays a $2.00 a share dividend. if the person chooses to reinvest that dividend, this means that the $2.00 will go toward buying

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10-12-2022
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a person owns a stock that pays a $2.00 a share dividend. if the person chooses to reinvest that dividend, this means that the $2.00 will go toward buying

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v798314 v798314 · Answer 1 · 2022-12-17T14:25:35+01:00

The owner of the stock receives a dividend of $2 per share. If the shareholder decides to reinvest the dividend, the $2 will be used to purchase more shares of the same stock.

A corporation may pay its shareholders a dividend when it distributes its profits to them. A corporation is able to distribute some of its profits as dividends to its shareholders when it makes a profit or has excess cash.

Retained earnings are the sums that are not distributed but are kept and reinvested in the company. Dividends are consistent payments provided by a firm to its investors as a form of profit-sharing.

The price per share, as well as when and how frequently dividend payments are issued, are decided by the board of directors of a firm. Stocks that pay dividends can offer a steady income stream, which is beneficial in times of inflation.

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