Finance is a discipline which focuses on allocating assets and liabilities over a space and time, usually in uncertain and risky conditions. Finance is often defined as the science of money management and is divided into three sub-categories: public finance, corporate finance and personal finance.
Public finance focuses on the role of the government in the economy. This branch assesses the government revenue and expenditure of the public authorities, as well as adjusts these variables to have the desirable effects.
Corporate finance deals with the sources of funding and the capital structure of corporations. Also, this branch explores the actions which managers take to increase the value of the business to the shareholders and the decisions which analysts make to allocate resources.
Personal finance concerns the financial management which an individual or a family has on a budget. This branch usually includes payments for education, durable goods or insurances.
As well as this, finance can be divided into two main types: debt finance and equity finance. Debt finance deals with the money borrowed from external lenders such as banks; equity finance focuses on the money investments made in exchange for partial ownership.
There are different sources of debt finances, including financial institutions, retailers, finance companies, factor companies, suppliers, peer-to-peer lenders, family or friends and suppliers.
Instead, the equity finance sources are personal finances, private investors, crowdfunding, government, venture capitalists and crowd-sourced equity funding.
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