Dividend policy is a crucial aspect of corporate finance that influences how companies distribute profits to their shareholders. It involves the decisions a company makes regarding the amount and timing of dividend payments to its investors. A well-thought-out dividend policy can play a significant role in attracting and retaining investors, shaping a company’s capital structure, and signaling its financial health and stability. What Are Dividends? Dividends are payments made by a corporation to its shareholders, typically in the form of cash or additional shares of stock. They are a portion of a company’s profits that is distributed to investors as…