1.1 Finance: An Overview
To begin our study of business finance, we present an overview of the field and define the types of decisions addressed by the study of business finance. We also discuss the motivation for studying finance and briefly introduce the five principles of finance.
What Is Finance?
Finance is the study of how people and businesses evaluate investments and raise capital to fund them. Our interpretation of an investment is quite broad. In 2016, when Fitbit introduced the Fitbit Blaze, an activity-focused smartwatch, it was clearly making a long-term investment. The firm had to devote considerable expense to designing, producing, and marketing the smartwatch with the hope that it would eventually capture a sufficient amount of ...
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