What Is Finance

Table of contents:

What Is Finance
What Is Finance

Video: What Is Finance

Video: What Is Finance
Video: What is Finance? 2024, March
Anonim

The term "finance" originated in Italy and originally meant any cash payment. Then he received international distribution and began to designate the system of monetary relations between the state and the population regarding the formation of monetary funds.

What is finance
What is finance

Instructions

Step 1

Currently, the concept of finance is multifaceted. This term refers to the totality of all material resources in the use of all economic entities: the state, enterprises and citizens. Finance refers to the economic relations that arise in connection with the formation and use of funds of funds in the process of their distribution and redistribution.

Step 2

Finance has some characteristics: - the presence of monetary relations between two entities, i.e. money is the material basis of finance. There is no finance without money; - subjects of financial relations have the same rights. The exception is the state. It is endowed with special powers. The state establishes taxes, fees, regulates the procedure for the formation of funds at enterprises; - in the process of financial relations, the state's monetary fund is formed - the budget.

Step 3

Based on the specific features of finance, we can conclude that these are economic relations associated with the formation, distribution and use of centralized and decentralized funds of funds for the purpose of fulfilling the tasks and functions of the state and ensuring conditions for expanded reproduction.

Step 4

The financial system in our country includes several areas of financial relations: the state budget and extra-budgetary funds, credit, property and personal insurance funds, the stock market, finance of enterprises of various forms of ownership. All these relationships can be divided into two systems. These are state finances, due to which the needs of expanded reproduction at the macro level are met, and the finances of business entities used to ensure the reproduction process at the micro level.

Step 5

Another meaning of the term "finance" should be distinguished from the totality of material resources and the system of economic relations. It is also an economic discipline, which is devoted to the study of money and the socio-economic relations that arise in the process of their use.

Step 6

In everyday life, finance is simply money. In this regard, there are public (state and municipal) and private (personal, family, banking, enterprises and organizations) finance.

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