The study of business finance is concerned with the provision, flow and use of finance within a business organisation and with the demand for, and supply of, funds for business within the economy as a whole. It is our task in this opening chapter to indicate the main financial problems which arise within a firm, to outline the mechanism of the capital market, and to show how decisions, both within the market and within individual firms, interact. In a wide-ranging review of this sort it is essential to limit the discussion to the bare simplicities; more detailed and sophisticated consideration will be given to the various problems touched upon in the chapters to follow.
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