Definition of 'Finance'

The science that describes the management, creation and study of money, banking, credit, investments, assets and liabilities. Finance consists of financial systems, which include the public, private and government spaces, and the study of finance and financial instruments, which can relate to countless assets and liabilities. Some prefer to divide finance into three distinct categories: public finance, corporate finance and personal finance. All three of which would contain many sub-categories.

 The study of finance can also take many forms, depending on the field or area of finance which one wishes to study. For instance, economics is considered a pillar of financial science, where both macro and microeconomic factors affect virtually levels of financial decisions and outcomes at all levels.

Macroeconomics

The field of economics that studies the behavior of the aggregate economy.Macroeconomics examines economy-wide phenomena such as changes in

• Unemployment
• National income 
• Rate of growth
• Gross domestic product
• Inflation and price levels.

I’ll talk about the above mentioned factors in detail and how are they inter-related and what role does central bank plays in controlling these factors in my next post.