The Aims

After the course, you’ll be able to

• Figure out the terms such as finance, financial system,
financial instituition, interest rates, stock, etc.
• Understand basic information of money and financial
systems
• Describe the operating mechanism of the financial systems
and financial markets
• Analyze the relationship between money, credit, interest
rates and financial markets
Part 1: Money and Financial Systems
• Fundamental of Finance
• An Introduction To Money And Financial Systems
• Money And The Payments System
• Financial Instruments, Financial Markets, And Financial Institutions
• Future Value, Present Value, And Interest Rates

Part 2: Financial Intermediation

• The economy of Financial Intermediation
• Financial Industry Structure

Part 3: Finance and Components of Finance

• Public Finance
• Corporate Finance
 PSU-FIN 271
Money and Banking 1

Chapter 1 - Fundamentals
of Finance
2 hours
M. Fin. Dang Le Vu
Email: danglevu@dtu.edu.vn
 Learning Objectives

1. To understand and analyze the concepts and

functions of Finance.

2. List and analyze the Characteristics of Components

of Finance
 Outline

1.1 Functions and Concepts.

1.2 Financial System

1.3 Characteristics of Components of Finance

WHAT IS
FINANCE?
Functions and Concepts
Concepts
In General sense:
● Finance is the management of money and
other valuables, which can be easily converted
into cash to Academicians:
According
● Finance is a system of distribution relationships
between economic entities through the
establishment and use of monetary funds
Money Credit

Banking Investments
Functions and Concepts
Functions

● Distribution

● Monitor
Functions and Concepts
Functions

● Distribution

● Monitor
Financial System
Concepts of Financial System
● Financial System is the system consisting
of financial market and institutions which
connect Supply-Demand
Structure of Financialof capital each
other
System
● Financial market
● Financial institution
● Financial infrastructure
Structure of Financial
System
Financial market
Financial market are places where financial
instruments are bought and sold, includes:
● Money market

● Capital market
Structure of Financial
System Financial
institution
Forming financial entities in the market
economy includes institutions associated
with the activities of Public Finance,
Business/Corporate Finance, Financial
Intermediaries, and Personal or
Household Finance.
Structure ofFinancial
Financial System
infrastructure
• Legal and State Management System

• Human Resources System and Supervision

Mechanism
• Information System

• Payment/Settlement System, Stock Exchange

Key Terms

1.Mobilization
2.Distribution
3.Monitor
 Quiz
1. Which of the followings are the functions
of finance:
A. Mobilization and Distribution
B. Monitor finance
C. All of the above
D. None of the above
 Quiz
2. Which of the followings are Financial
Infrastructure:
A. Legal and State Management System
B. Human Resources System and
Supervision Mechanism
C. Information System and
Payment/Settlement System, Stock
Exchange System