Fin 370 Financial Management Research Paper

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Financial Management Definitions and Concepts Patrice Colbert FIN/370 May 14, 2012 Finance: the study of money: The study of how businesses manage funds in order to operate to make profits, and how individuals manage their financial resources economically. The study of finances and learning the 4 principles of finance plays an important role as it assists to understanding how and why businesses and individual make financial decisions. Efficient market: Market where all pertinent information is available to all participants at the same time, and where prices respond immediately to available…show more content…
Common stock usually entitles the owner aka, shareholders the right to vote and collect dividends. Preferred stockholders do not vote, however, they claim a higher yield on assets and earnings than the common shares. Bond: A financial instrument issued by corporations, federal and local governments issued for the purpose of raising capital; a debt security that promises repayment with interest. Capital; the simplistic definition is money. Capital is used to generate income, capital, or money is used to make investments that will generate more income. Capital is also obtained by selling stocks which is monies used to build the business or for operations aka working capital Debt: monies owed. Debt is what is borrowed and be repaid. Loans, a debt security is one form a debt and the issuance of bonds is another form of debt Yield: is simply a return on an investment. Yield are expressed in percentages designating the amount expected to receive on an investment in the form of interest and/or

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