Business Finance – An Introduction

A company is a commercial entity that is launched by few people and its actions belong to these rare people. As society is growing, its actions will be listed in the stock market and can be exchanged by the General Pubic. At this point, it can be called as a public company. The advantage of society is the scope of investments. Anyone can even invest a small money and become a partner in the company. Thus, the company will receive money for their business. As the company grows, the holder of the action will get the advantage of shared profit.

The company can get even investments of great forms such as pension funds, federal funds, insurance companies. They purchase significant volume and can therefore control business decisions. As the company pushes that the benefits are shared tilting on the part of each person. This way of giving benefits is done on behalf of the dividend. To represent the aspirations of stock owners, they elect the Board of Directors. These are non-executive members of the Board of Directors and not directly employed by the Company. They will ensure that the Company will make decisions for the interests of shareholders.

When a person invests in stock, he has limited liability. You only need to pay for losses to society to return to the track as a holder of the participation. At best, you will lose the part of the money invested in actions. This happens when the company’s performance is bad.

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