What is business finance? Why do businesses need funds? Explain.

The fund used in business to carry out various activities is called business finance.

The business required funds for:

• To start a business one requires funds to purchase assets such as raw materials, machinery etc. The funds are invested for a long period.

• The financial requirements of an enterprise do not end with the procurement of fixed assets. No matter how small or large a business is, it needs funds for its day-to-day operations. This is known as the working capital of an enterprise.