Financial Management is mainly concerned with
A) Arrangement of funds
B) All aspects of acquiring and utilizing financial resources for firm’s activities
C) Efficient management of every business
D) None of these.
Financial Management is mainly concerned with all aspects of acquiring and utilizing financial resources for firm’s activities. In Financial Management, decisions are made regarding how much and what type of assets to acquire, how to raise the capital necessary to acquire assets, and how to operate the firm so that its value is maximized. It is a branch of finance that deals with the management of all the financial resources of an organization for the smooth performance of its goals. Generally, finance functions are performed for the benefit of a firm or corporation.
The goal of financial management is to make financial data practical and meaningful. By allocating scarce resources among competing business opportunities, financial management creates value and organizational agility. Business strategies are implemented and monitored through financial management.
The two main goals of Financial Management include:
- Profit maximization and
- Value maximization (Shareholder wealth maximization)
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