ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Shares are units of equity ownership in a corporation. For some companies, shares exist as a financial asset providing for an equal distribution of any residual profits, if any are declared, in the form of dividends. Shareholders of a stock that pays no dividends do not participate in a distribution of profits.

Detailed explanation-2: -So, we can say that a share of a company’s net profit distributed by the company to its stockholders is called dividend.

Detailed explanation-3: -Definition: Earnings per share or EPS is an important financial measure, which indicates the profitability of a company. It is calculated by dividing the company’s net income with its total number of outstanding shares.

Detailed explanation-4: -Shareholders, or stockholders, are the owners of a company’s outstanding shares, which represents a residual portion of the corporation’s assets and earnings as well as a percentage of the company’s voting power.

Detailed explanation-5: -There are two ways to make money from owning shares of stock: dividends and capital appreciation. Dividends are cash distributions of company profits.