Revision Notes For Class 12 Business Studies Chapter 9 Financial Management

Financial management is the chapter that educates the students regarding the efficient utilisation of the finances. This chapter comprises of various significant concepts that is useful for the revision sessions – meaning of business finance, financial management, role of financial management, objectives of financial management, financial decisions, investment decision (capital budgeting decision), factors affecting financing decisions – cost, risk, flotation cost, factors affecting dividend decisions are – earning, stability of earning, taxation policy, legal restrictions, stock market reaction, financial planning, objectives of financial planning, capital structure, financial leverage.

Frequently asked Questions on CBSE Class 12 Business Studies Notes Chapter 9: Financial Management

What is ‘flotation cost’?

Flotation costs are costs a company incurs when it issues new stock. Flotation costs make new equity cost more than existing equity.

What is ‘Financial planning’?

A financial plan is a comprehensive picture of current finances, financial goals and any strategies that one has set to achieve those goals.

What is ‘stock market reaction’?

A reaction, in the context of financial markets, is a sudden but usually short-lived upwards or downwards movement in a stock’s price.

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