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Unit 4

TermDefinition
Corporate finance the area dealing with monetary decisions that corporate enterprises makes
Managerial finance the area dealing with monetary decisions that all types of companies make, except corporations
Personal finance individual taking care of their money
Dividends a small payment to each person who owns a stock of the company
Liability an obligation, debt or responsibility owed to somebody
Allocate to distribute according to a plan
Capacity the ability of the borrower to repay the loan
Capital the money the entrepreneur has personally invested in the business
Collateral an asset pledged to the lender as a security for the money being borrowed
Conditions intended purpose of the loan
Character general impression the entrepreneur makes on the potential lender as to their trustworthiness to repay the loan
Interest the cost of borrowing money
Principal the amount of the loan
Interest rate a rate which is charged or paid for the use of money
Assets the resources from which it expects to gain some future benefit
Liabilities Debts owed
Net worth How much an entity is worth
Profit a financial gain
Cash flow amount of money being transferred into and out of a business
Sales a quantity or amount sold
Created by: Lisandro
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