Role of the financial market in attracting external financial resources to finance the activities of enterprises
PLAN
Introduction
1. Financial markets and its types and functions
2. The need for external financial resources in business entities
3. Development of financial markets in Uzbekistan and the opportunities for enterprises.
Conclusion.
Introduction
In this day and age, business entities ought to attract much more financial resources in order to survive in stiff competition than they used to have to. Enterprises strive to purchase additional assets and other technologies to broaden scales of production and to make more profit, which makes them to generate extra funds. Besides, companies will be able to open new branches or to embark on business in other fields as long as they have sufficient money. If they take money out of current capital in production to invest for other activities, they might lose in competition with rivals or they might fail to provide their customers. Similarly, if they wait until they make enough profit from main activity, it may take years to gain enough money, because many large projects need an immense amount of money to be started. Therefore, enterprises are in demand for extra capital to borrow and financial markets enable them to do so. asssssssssssssssssssssssssssssdxddsssss
Business entities often need to raise external funding or capital in order to expand their businesses into new markets or locations. It also allows them to invest in research & development (R&D) or to fend off the competition and, while companies do aim to use the profits from ongoing business operations to fund such projects, it is often more favorable to seek external lenders or investors to do so. Despite all the differences among the thousands of companies in the world across various industry sectors, there are only a few sources of funds available to all firms. Some of the best places to look for funding are retained earnings, debt capital, and equity capital. Like individuals, companies can borrow money—and they do. Furthermore, most businesses today engage in financial activities along with their main activities, as they have intention of increasing their funds which are raised in operative activities. In general, there are two main sources of capital: bank loans or selling shares or obligations in financial markets. ddddпппааппапdd
Finally, an understanding of finance is important to companies most companies are relying on their own earnings to finance their expenses and investment projects, whereas others are raising money or borrowing it from the financial markets, or institutions and procedures that facilitate financial transactions.
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