Final answer:
Dividends are payments to shareholders, while capital gains are profits from selling stocks at a higher price.
Explanation:
Dividends are payments made from company profits to shareholders based on the number of shares owned. The more shares an individual owns, the more dividends they receive. Capital gains refer to the profit made from selling a stock at a higher price than purchased. Both dividends and capital gains are ways shareholders earn income from their stock investments.
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