Variant 1 The concept and essence of finance

Variant 1

 

1. 
   The concept and essence of finance.
   

Finance is a system of monetary relations for the formation, distribution and use of centralized and decentralized funds of funds during the distribution and redistribution of gross domestic product (GDP) and national income in order to expand production, meet social and other needs, and provide material incentives for workers. Finances are the basis for making decisions on how to get funds and what we should do with them, if we have them. It is a financial system that provides a platform through which funds are transferred from enterprises that have funds to those enterprises that need funds.

The state, commercial enterprises and households in the course of their functioning form, distribute and use money funds. A money fund is a separate set of money intended to finance certain goals and objectives of an economic entity.

Different definitions of the term "Finance":

Finance is a science that describes the management, creation and research of money, banking, credit, investment, assets and liabilities. Finance consists of financial systems that include the public, private and government sectors, as well as the study of finance and financial instruments that can cover countless assets and liabilities. Some authors prefer to divide finances into three different categories: public finance, corporate finance and personal finance, which may contain many subcategories.

Zvi Bodie and Robert C. Merton view finance as the science of how people control the spending and receipt of scarce cash resources over a period of time. Financial decisions are characterized by the fact that costs and revenues: 1) are spread out over time and 2) as a rule, they cannot be accurately predicted by those who make decisions or by anyone else.