Principles of Finance Course Outline

Set of vocabulary flashcards covering key concepts from the Principles of Finance course outline.

Financial Management

The function within a business that involves financial decision-making, including investment, financing, and dividend policy.

Working Capital Management

Management of short-term assets and liabilities, focused on maintaining sufficient cash flow for operational efficiency.

Capital Budgeting

The process of planning and managing a firm's long-term investments.

Sources of Finance

Different ways through which a business can acquire funds, including loans, equity, and leasing.

Time Value of Money

The concept that money available today is worth more than the same amount in the future due to its potential earning capacity.

Dividend Policy

A company's approach to distributing profits back to its shareholders, which can include regular dividends, special dividends, or stock buybacks.

Cost of Capital

The minimum return that a company must earn on its investment projects to satisfy its investors.

Ratio Analysis

A quantitative method of gaining insight into a company's liquidity, profitability, and operational efficiency.

Investment Decision Analysis

The assessment of potential investment projects by analyzing their costs, benefits, and risks.

Hybrid Finance

A form of financing that combines aspects of debt and equity.