dividend

Vocabulary Word

Definition

'Dividend' is a portion of a company's profit that is distributed to its shareholders. It's like a pie – after making profit, the company cuts pieces of this pie to its shareholders as their share of the gains.

Examples in Different Contexts

In the corporate world, 'dividend' policies can influence investor decisions. A CEO might state, 'Our consistent dividend payouts showcase our commitment to shareholder value.'

Practice Scenarios

Startup

Scenario:

I believe our reinvestment strategy has been beneficial to our growth. But we should also think about potential rewards for our early investors.

Response:

Once our profits are more predictable, we can certainly start considering a dividend policy for the company.

Business

Scenario:

Our company's profitability has grown over the current fiscal year. It may be prudent to reward our shareholders.

Response:

Given our current profitability, it is indeed the right time to consider a substantial dividend payout to our shareholders.