When companies set their dividend payout, they generally aim for a rate that is?

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Business

Jaslyn Beck

10 March, 00:09

When companies set their dividend payout, they generally aim for a rate that is?

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Anaya Hamilton · Answer 1

The companies set their dividend payout, they generally aim for a rate that is when it is sustainable. The dividend payout ratio is the amount of dividends paid to stockholders relative to the amount of total net income of a company. The amount that is not paid out in dividends to stockholders is held by the company for growth. The amount that is kept by the company is called retained earnings.