Is it true that stocks, which pay out dividends, usually drop in value on the date in which they pay the div.?

No stocks do not drop in value on the date they pay the dividend,

There are four dates involved with dividends

1 Declaration date - A date set by the company on which the company declares that it will be paying a dividend to its share holders

2. X-Date - This is the date set by the market place on which all trades in this date the security will be reduced by the amount of the dividend. Any one buying the stock on this date will not receive the dividend since the trade will settle after the record date, therefore the seller will be the owner of record on the record date. The stock is said to trade on this date "X dividend" meaning "without the dividend

3. Record Date - set by the Company. The date the shareholders must be on the books of the firm to be entitled to the dividend.

4 Payable Date - set by the company. The day the dividend is to be paid to the shareholder holding the stocks as of the record date.

Because some people get into the stock just to get the dividend. On the ex-dividend date, they sell because they already got the dividend money.

It is true, because they are paying out money from the company. It comes from retained earnings and affects the equity. The stock price adjusts for this. But other factors could raise or lower the stock more or less on that day. You are not thinking of mutual fund distributions.

"A Money Machine?

Now that we understand that a dividend can be received by purchasing the stock before the ex-date, can we make more money? Nope, it's not that easy. Remember, everybody knows when the dividend is going to be paid, and the market sees the dividend payout as a time when the company is giving out a part of its profits (reducing its cash). So the price of the stock will drop approximately by the amount of the dividend on the ex-dividend date. The word "approximately" is crucial here. Due to tax considerations and other happenings in the market, the actual drop in price may be slightly different. In any case, the point is that you can't make free profits on the ex-dividend date."

They usually drop on the "ex-dividend" date (the date you have to own them to qualify for the dividend) rather than the dividend date....not quite the same thing!

no it is not true. the drop, if any, will usually be as early-hours trading opens on the ex-div date.

the actual dividend payment date is mostly meaningless wrt stock price.

Yes, they should drop in value by the amount of the dividend.

Why? Suppose my business is worth $1000. If I pay out a dividend of $100, then my business is only worth $900.

No. You are thinking of mutual fund distributions.