There are at least two ways that an investor can profit by investing in stock:...
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Accounting
There are at least two ways that an investor can profit by investing in stock: (1) dividends and (2) stock price increases. Some investors care more about dividends, and others are more interested in whether the company's stock prices are expected to increase. Investors have to decide if it is better to invest in growth or in dividends? (Hint: search term there)
From the company's perspective, why do they pay dividends? What do some companies prefer to keep their capital and reinvest it in the company? Does this make their investors (shareholders/stockholders) happy or unhappy?
Look outside the textbook for resources on these issues and discuss them from (1) the investor perspective and (2) that of the company. Investors are concerned with maximizing profits, and company management is concerned with keeping the stockholders/shareholders happy and with making the company look good to all the stakeholders in general. There are several pressures here. list your references
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