Financial Resource Management Essay Example | Topics and Well Written Essays - 750 words

Financial Resource Management - Essay ExampleWith the help of trade goods are make available to consumers at the time of their need. It removes the hindrance of persons by bringing together producers and consumers who are widely scattered.financing is of two types, fair-mindedness financing and debt financing. When you are in need of money or looking for capital, companys debt-to-equity-ratio should be considered. It is the relations between the Dollars or Euros that an entrepreneur has borrowed and Dollars or Euros invested in the business. The more the investment by the owners the more they attract the financing.When the equity to debt ratio of the firm is high then debt financing should be taken. If the proportion of the debt to equity ratio of the firm is high then it is advised that the owners should increase their equity investment, that way they cannot jeopardize firms survival. restrict equity financing is used by or so of the petty(a) or growth stage businesses. Whereas in debt financing, funds pour in from different quarters like from friends, relatives, etc. Venture capitalists are the most common source of equity funding. Venture capitalists may be institutional risk takers, financial institutions, stiff persons, etc. and most of them specialize in industries. Venture capitalists are risk takers and show interest only if in three to five year old companies that result in more than average profits. These accident capitalists are called as investment gurus whose interest lies in those companies that have major regional and national concerns. Debt supportCommercial finance companies, financial institutions, banks, savings and loans, Lloyds Bank small business, etc. are some of the sources for debt financing. Because of their dogmatic impact on the whole economy local and state government encourage the growth of the small companies. In debt financing additional funds comes from friends, family, relatives, and industry colleagues, etc when capit al investment is smaller.Generally banks formed as a major source for loans for the establishment of small businesses. Banks dont offer long term loans to small firms kinda they grant short term loans for machinery and