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Financing the Four Sectors: Companies, Households, Governments and Overseas Through Credit and Capital Markets

  • Brian Scott-Quinn
Chapter
  • 14 Downloads

Abstract

Financing involves two stages:
  1. 1.

    First, project evaluation, which means calculating whether or not a proposed project is financially viable, i.e. will it, probabilistically, generate the returns that a bank lender or investors expect for the level of risk it presents? This is generally done using the discounted cash flow approach to project evaluation which in the case of a company is part of the capital budgeting process.

     
  2. 2.

    Second, the pooling (collection) of small savings into a unit of financing large enough to meet the needs of the project.

     

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Copyright information

© Palgrave Macmillan, a division of Macmillan Publishers Limited 2012

Authors and Affiliations

  • Brian Scott-Quinn
    • 1
  1. 1.ICMA Centre for Financial Markets, Henley Business SchoolUniversity of ReadingUK

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