MGTA05H3 Lecture Notes - Lecture 9: Financial Services, Making Money, Financial Intermediary
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People with money but no immediate plans and ideas. People with no money but have plans and ideas. Finding, collecting, repackaging, and distributing capital to those who needs it. Businesses need to spend money before they can actually start making money. They have to incur costs, pay for costs long before they can start selling products to generate revenue. People must determine how much money they need, how and where are they going to get the money. In canada, many businesses belong in this industry. Debt capital: mo(cid:374)ey that is le(cid:374)t, you do(cid:374)"t lose o(cid:449)(cid:374)ership, you ha(cid:448)e to repay, le(cid:374)der gets interest. Equity capital: money that is given, you give ownership, never repaid, the owners can share profit. One of the reasons why a country has good productivity is that it has access to plentiful factors of production in good use.
