Explain why firms do not simply pay out dividends as a fixed portion of their profits. What

Question:

Explain why firms do not simply pay out dividends as a fixed portion of their profits. What do most firms do in terms of policy?

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...