Definition of finance
Finance is the discipline of study that basically deals with money, management of money, and the value of money over times. It teaches us how to obtain the required fund at least possible cost and how to invest our available resources for maximum possible return.
Finance intends to price assets based on their Rate of return and the associated risk factor. Finance loves more to work with assets those are more liquid in nature.
In fact, it covers the whole financial systems consists of money, investment, credit, banking, insurance, assets, liabilities, payment system… almost everything. Finance also studies the change of human behavior to all the components of financial system under different situations over times. That is why finance is called the “science of money management”.
Finance is considered as a branch of Economics. Most of its concepts have come from macro and microeconomics. But at the same time its a dynamic discipline of study. Finance is evolving every year, every day with new concepts. Think about “Cryptocurrency” !.
All the activities we do or happening in the world are somehow related to finance. Finance has a very broad scope. It encompasses our personal life, corporate world and national and international matters too.
Scholars used to divide finance into three parts for convenient discussion. These are Personal Finance, Corporate finance, and Public finance.