No one in
business denies that the commercial environment has changed. These changes have
brought about a number of critical factors which have a direct impact on the
operational activities of businesses.
Today’s
business arena is characterized by high level of competition, homogenous
products, globalization and e-commerce, more informed customers, and in some
industries supply exceeds demand. The current international economic and
financial situation is also lending its hand to making the business environment
more hostile due to late payment, payment defaults and bankruptcies!
To survive,
firms are striving to properly adapt their structures, corporate objectives,
strategies and tactics in a cost effective manner in order to meet today’s
market needs. The name of the game in doing business, irrespective of the
industry, market or economic sector, has become that of gaining and sustaining
competitive advantage in the market more than ever before.
I. First
We talked in positions precedent for credit and its
definition, types and forms and uses, and here we will talk about jobs and
credit instruments, first the functions of the credit can be summed up quickly
in that credit is a tool used by financial institutions to create money (we'll
come to later to explain the process of money creation).
Also helps legal money (banknotes) or paper money in
the development of new ways to push the quality and quantity so that they can
meet the needs and requirements of the society and the life or economic
development. Credit plays an important role in increasing the efficiency of
resource allocation processes, whether in the field of production or
consumption in the area of production. Credit also plays a major role in
determining the level of national income, cash, where there is always a direct
correlation between the rate of credit creation and the level of national
income, we expect to increase the level of national income, the greater the
rate of credit creation, and vice versa.
II. Second
Considered commercial paper credit instruments
short-term, while longer Securities tools long-term credit, as is the paper
money itself of credit instruments, the following brief summary of credit
instruments, which include commercial paper, which represents as mentioned
tools short-term credit, which is characterized by fast Circulation and the
absence of many legal restrictions on them, is the most important bill of
exchange, promissory note, check and treasury bills. The securities, which are
long-term credit instruments is the most important stocks, bonds and paper
money or legal.
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