1. PARTIES IN FINANCIAL ENVIRONMENTS
1.1. money market
1.1.1. Short term instruments
1.1.2. Very liquid
1.1.3. Treasury bills
1.2. Capital market
1.2.1. Long term instruments
1.2.2. Less liquid
1.2.3. Stocks, Bonds
1.2.4. PRIMARY MARKET
1.2.4.1. private placement
1.2.4.2. Through investment banker
1.2.4.3. Through financial institutions
1.2.5. SECONDARY MARKET
1.2.5.1. where securities & other financial assets are resold among investors
2. VARITIES OF BUSINESS ORGANIZATION
2.1. 1.SOLE PROPRIETORSHIP
2.1.1. owned by one person
2.1.2. Unlimited liability
2.1.3. Restricted to the life of the individual who created it
2.2. 2.PARTNERSHIP
2.2.1. consists of two or more owners doing business together for profit
2.2.2. All partners
2.2.2.1. Have unlimited liability
2.2.2.2. Legally liable for all debts of the partnership
2.3. 3. CORPORATION
2.3.1. intangible business entity created by law
2.3.2. Owner are shareholders
2.3.3. Management is done by election of Board Of Directors (BOD)
3. RESPONSIBILITIES OF FINANCIAL MANAGER
3.1. forecasting & planning
3.2. Investment and financing decisions
3.3. Coordination & control
3.4. Dealing with financial market
4. Finance?
4.1. Money
4.2. Markets
4.3. Def:the study of acquisition& investment of cash or funds - to enchancing value and welth
5. Parties in financial environment
5.1. Financial managers
5.1.1. Make investment decision
5.2. Investor
5.2.1. Provide funds to firm
5.2.2. Loan
5.2.3. Securities
5.3. Financial market
5.3.1. Place for suppliers & demanders of loans can transact business directly
5.4. Financial institution
5.4.1. Serves & intermediaries that channel savings of individual, business & government into loans or investments
6. FIRM'S OBJECTIVE
6.1. A) TO MAKE PROFIT
6.1.1. marketing effort
6.1.1.1. Concern with that firm offer
6.1.2. Financial effort
6.1.2.1. What firm proposes to gain financially from effort
6.2. B) TO STAY IN EXISTENCE
6.2.1. generate enough profits to make sure that firm be inexistence in long run
6.2.2. Make as much profit appropriate profit maximization objective