The overall rationale under which a firm pays dividends is referred to as its:

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Dividend policy refers to the overall approach and philosophy that determines how a company distributes dividends to its shareholders. This policy takes into consideration various factors, such as the company's financial strength, profitability, cash reserves, growth opportunities, and shareholder preferences. The dividend policy affects the level, timing, and form of dividends paid by the company.

The Overall Rationale Under Which a Firm Pays Dividends Is