Introduction to Finance

The field of Finance is concerned with the management of financial resources, usually in terms of assets or liabilities. Finance is a key element in all economic activity and therefore, it should be well prepared for whatever purpose it has to serve. This branch of commerce is dealing with a wide variety of diverse areas, like, market research, budgeting, risk management, and business banking. All this helps them to conduct business with confidence and make decisions accordingly.

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There are various types of Finance as well. In the broadest sense, finance can be divided into three main heads: micro, non-micro and macro. Micro Finance is that which concerns the interaction of financial agents, i.e., traders and investors, and inter-personal, i.e., company and organizational finance. It mainly uses short term and long term resources. Micro Finance covers financial activities of micro organizations only.

Non macrosubjects are those which deal with all financial activities of broader macroscopic objects. Thus, Finance as a whole can be considered as the study of enterprise. Finance deals with issues of business cycle, business cycles, business income cycle, business cash cycle, business credit cycle etc. business organization. Finance planning provides a clear picture of the working capital requirements, surplus cash supply, and debt and cash positions. A good Finance policy can help a company to adopt various measures, such as borrowing money, selling its fixed assets, and increase the cash flow.

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