Finance is the study and discipline of money currency and capital asset, it is the related to, but not synonymous with economics, which is the type of production, distribution, and consumption of money goods and service
Finance is mainly study of prices, interest rates, money flows, and the financial markets, In a broader sense, the concept of finance also focuses on the time of money rates of return, capital cost, optimal financial structures and the quantification of risk
Finance is defined as the management of money and includes activities such as investing, borrowing, lending, budgeting, saving, and the forecasting mainly there are the three main types of finance
- Personal Finance
- Corporate Finance
- Public and Government Finance
Personal Finance
Personal Finance is the financial management which is the individual or a family unit performs to budget, save, and spend monetary resources over time, taking account various financial risks and future life events Personal Finance is a term that covers managing your money as well as saving and investing. It encompasses budgeting banking, insurance and mortgages and the investments and retirements.
Corporate Finance
Corporate Finance :- corporate finance is the area of that deals with the sources of funding, and the capital structure of corporations, the actions that managers take to increase the value of the firm to the shareholders, and the tools and analysis used to allocate financial resources. Corporate finance is a subfield of finance that deals with how corporations address funding sources, capital structuring, accounting, and investment decisions corporate finance.
Public And Government Finance
Public finance is the way of managing public funds. However, it is limited to administering public funds and the other things and like price, stability, economic and growth, income inequality and unemployment and, human rights, Management of public Finance is the wider term. Public finance is the management of the country’s revenue the study of public funds and how governments raise, spend and distribute cash is known as public finance.
Conclusion
As conclusion, capital budgeting is a process of a company used to determine whether the projects available are worth for pursuing in a long-term venture such as new machinery, replacement of machinery, new plants and new products for its business.
Once a company has the calculations to analyze possible investment return, they can make a decisions about the long-term investment of a company’s capital into operations.
Hence, it is a very important aspect for a company’s financial management in the long run.
Besides that, capital structure is one of the important roles for a company’s financial management. Capital structure known as a mix of a company’s long-term debt, specific short-term debt, common equity and preferred equity.
People usually look into a firm’s debt-to-equity ratio because it provides insight on the stability of a company. In short, it is about how a company finances its overall operations and