Dividends reduce the stockholder's investment in the firm.

Name: Dividends reduce the stockholder's investment in the firm.
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Question

Quizplus · Accepted Answer

Dividends are payments made by a company to its shareholders from its profits. These payments reduce the amount of the company's profits that are retained within the business and are therefore available for reinvestment or other purposes. As a result, dividends reduce the amount of money that shareholders have invested in the company.

Dividends Reduce the Stockholder's Investment in the Firm