Finance and the Economy

Finance and the Economy

Prepared by student of ANDMI

Groups № S-83-21

Nozimbek Sodikov

Plan:

Finance vs. Economics: What's the Difference?
Finance vs. Economics: An Overview
Key takeaways

• Finance:

Personal finance
Finance

• Special Considerations:

degree in finance 

• Economics:

degree in finance 

• Special Considerations:

Although they are often taught and presented as separate disciplines, economics and finance are interrelated and inform and influence each other. Investors care about these studies because they also influence the markets to a great degree. It's important for investors to avoid "either/or" arguments regarding economics and finance; both are important and have valid applications.
As a general social science, the focus of economics is more on the big picture, or general questions about human behavior around the allocation of real resources. The focus of finance is more on the techniques and tools of managing money. Both economic and finance also focus on how companies and investors evaluate risk and return. Historically, economics has been more theoretical and finance more practical, but in the last 20 years, the distinction has become much less pronounced.
In fact, the two disciplines seem to be converging in some respects. Both economists and finance professionals are being employed in governments, corporations, and financial markets. At some fundamental level, there will always be a separation, but both are likely to remain very important to the economy, investors, and the markets for years to come.
Finance vs. Economics: An Overview
Key takeaways
Key takeaways

• Economics and finance are interrelated disciplines that inform each other, even if the specifics are distinct.
• Finance, as a discipline, is derived from economics; it involves assessing money, banking, credit, investments, and other aspects of the financial systems.
• Finance can be further broken down into three related but separate categories—public finance, corporate finance, and personal finance.
• Economics looks at how goods and services are made, distributed, and used, as well as how the economy overall functions, along with the people who drive economic activity.
• The two main branches of economics are macroeconomics, which looks at the overall economy, and microeconomics, which looks at specific factors within the economy.

• Finance:

Personal finance
Finance

Finance in many respects is an offshoot of economics. Finance describes the management, creation, and study of money, banking, credit, investments, assets, and liabilities that make up financial systems, as well as the study of those financial instruments. Finance can be divided into three categories: public finance, corporate finance, and personal finance
Finance typically focuses on the study of prices, interest rates, money flows, and the financial markets. Thinking more broadly, finance tends to center around topics that include the time value of money, rates of return, cost of capital, optimal financial structures, and the quantification of risk. Finance, as in the case of corporate finance, involves managing assets, liabilities, revenues, and debt for a business. Businesses obtain financing through a variety of means, ranging from equity investments to credit arrangements. A firm might take out a loan from a bank or arrange for a line of credit—acquiring and managing debt properly can help a company expand and ultimately become more profitable. Personal finance defines all financial decisions and activities of an individual or household, including budgeting, insurance, mortgage planning, savings, and retirement planning.