What Are The Major Sub Areas Of Finance?

What is the role of finance?

Finance involves managing the firm’s money.

The financial manager must decide how much money is needed and when, how best to use the available funds, and how to get the required financing.

The financial manager’s responsibilities include financial planning, investing (spending money), and financing (raising money)..

What are the major areas of decision making?

The three major areas of decision making can be divided decision, financial decision and investment decision. Investment decision relates that where should the funds and in what proportion should they be implied.

What are the two main types of finance?

There are two types of financing: equity financing and debt financing.

What are the two types of finance?

Two of the main types of finance include:Debt finance – money borrowed from external lenders, such as a bank.Equity finance – investing your own money, or funds from other stakeholders, in exchange for partial ownership.

What are the 3 major areas of finance?

Finance consists of three interrelated areas: (1) money and credit markets, which deals with the securities markets and financial institutions; (2) investments, which focuses on the decisions made by both individuals and institutional investors; and (3) financial management, which involves decisions made within the …

What are the categories of finance?

Finance can be broadly divided into three categories, public finance, corporate finance, and personal finance. There are many other specific categories, such as behavioral finance, which seeks to identify the cognitive (e.g., emotional, social, and psychological) reasons behind financial decisions.

Why do you study finance?

Studying finance can prepare you not only for careers in the financial services sector, but also for tasks in your everyday life. … And because finance revolves around planning and analysis, studying finance and becoming more financially literate enables people to make better personal financial decisions.

What is the subfield of finance?

Finance encompasses banking, leverage or debt, credit, capital markets, money, investments, and the creation and oversight of financial systems. … The finance field includes three main subcategories: personal finance, corporate finance, and public (government) finance.

What are the four 4 areas of financial management decision making?

There are four main financial decisions- Capital Budgeting or Long term Investment decision (Application of funds), Capital Structure or Financing decision (Procurement of funds), Dividend decision (Distribution of funds) and Working Capital Management Decision in order to accomplish goal of the firm viz., to maximize …

What are the 3 types of financial management decisions?

There are three decisions that financial managers have to take: Investment Decision. Financing Decision and. Dividend Decision.

What is Finance example?

Finance is defined as to provide money or credit for something. An example of finance is a bank loaning someone money to purchase a house. verb.

What are the 6 principles of finance?

There are six basic principles of finance, these are:Principles of risk and return.Time value of money.Cash flow principle.Profitability and liquidity.Principles of diversity.Hedging principle.

What are the 4 areas of finance?

Question: Discuss the four basic areas of finance. Which area is closely related to your current work? Corporate finance, Investments, Financial institutions, International finance.

What are the areas of financial management?

Functional Areas of Financial ManagementDetermining Financial Needs: A finance manager is supposed to meet financial needs of the enterprise. … Selecting the Sources of Funds: … Financial Analysis and Interpretation: … Cost-Volume-Profit Analysis: … Capital Budgeting: … Working Capital Management: … Profit Planning and Control: … Dividend Policy:

Why should a finance officer have good communication skills?

2. Finance managers deal with executives both within and outside the companies that they work for, requiring a strong ability to convey important information and explain complex financial ideas to professionals who do not specialize in the subject. …

How do you gain financial knowledge?

6 ways to improve your financial literacySubscribe to financial newsletters. For free financial news in your inbox, try subscribing to financial newsletters from trusted sources. … Listen to financial podcasts. … Read personal finance books. … Use social media. … Start keeping a budget. … Talk to a financial professional.

What are the four major sub areas of finance?

The major subareas of finance are investments, financial management, financial institutions, market, and international finance. Risk is a potential future negative impact to value and or cash flow. It is often discussed in terms of probability of loss and the expected magnitude of the loss. 2.