Individual Assignment: Defining Financial Terms
Resource: Financial management: Principles and applications
Define the following terms and identify their roles in finance:

• Finance - The management of revenues or other liquid resources of a government, business, group or individual; the conduct or transaction of money matters generally, especially those affecting the public, as in the fields of banking, investments and credit. It can simply be defined as sell on credit or commercial activities that are study to manage capital and assets.

Finance is an important part of any organization because it deals with resource allocation, accounting, resource management, and investments.

• Efficient market - A market in which the values of securities at any instant in time fully reflect all available information, which results in the market value and the intrinsic value being the same.

Efficient market is an integral part of understanding the value of shares and value of shareholders. In doing so, financial managers will have better information in making decision in terms of maximization of shareholder wealth.

• Primary market- Transactions in securities offered for the first time to potential investors.

Is the main market to which you are selling or buying directly from the issuer at par value (e.g. corporate bond). It is the company or any entity that the securities come from. In order for a stock to be considered in the primary market, the company or other entity must distribute it (the securities) themselves. The main markets do not trade their securities; they keep them until they decide to sell them. The primary market performs a crucial function of facilitating capital formation of the economy.

• Secondary market- Is where you buy or sell existing issues. These markets are used for trading stocks between persons and other entities that