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Managerial Economics - Industrial Finance And Foreign Direct Investments

Industrial Finance - Industrial Finance And Foreign Direct Investments

   Posted On :  30.05.2018 12:49 am

Finance is the life blood of business. It is of vital significance for modern business which requires huge capital.

Industrial Finance
 
Finance is the life blood of business. It is of vital significance for modern business which requires huge capital. Funds required for a business may be classified as long term and short term. It is required for purchasing fixed assets like land, building, machinery etc., the capital required to purchase fixed assets is called as fixed capital.
 

Purpose Of Industrial Finance:


To finance fixed assets
 
To finance the permanent part of working capital
 
To finance the growth and expansion of business.
 
The nature of business determines the amount of fixed capital. Nature of goods produced determines the level of financial requirement. If a business is engaged in manufacturing small and simple articles then it requires small amount of capital. The financial need depends upon the technology adopted in the organization. The major sources of finance are: shares, debentures, public deposits, retained earnings, term loans from bank, loans from financial institution etc.,.
 
The financial sources are expanded and a major source of finance comes from foreign direct investment (FDI) due to our economic reforms.
 

 

Tags : Managerial Economics - Industrial Finance And Foreign Direct Investments
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