Question

1. Mention and explain the functional area of the Firm

2. What is a Corporation

3. What are the Characteristics of a Corporation

4. Mention the types of financial decision of a Business and explain how they work

 

 

Answer 1

 

1. Functional area of the firm is to act upon the objectives and maximize the profits of its partners so that they could be satisfied and it will be trying to function according to the goals and the objective by adaptation of the appropriate strategies and the the firm will be trying to act in the best interest of its partners.

2. A corporation is a business organisation which will be owned by the equity shareholders and it will be having a existence which is separate from its owners and it will also have separate existence of ownership and Management.

3. Characteristic of corporation will be including limited liability for its members and perpetual life as well as owned by equity shareholders and separation of ownership and Management.

4.3 types of decisions are made by businesses and they will be related to investing decision which is related to investment into various projects and financing decisions which will be relating to use of finances like debt financing or equity financing and dividend decisions which will be related to payment or non payment of dividend.