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Corporate finance deals with decisions related to funding sources and the tools used to analyze the credibility of those decisions. The main goal of corporate finance is to maximize the value of a firm and implement strategies to reduce financial risk. It differs from managerial finance, which involves not only corporations but also the financial decisions of firms, giving it a broader scope. Managerial finance includes long-term decisions like capital investment and short-term decisions like maintaining the balance between current assets and liabilities. Investment banking is associated with corporate finance.
Investment banking primarily focuses on evaluating a firm's capital needs and raising capital through appropriate tools. Therefore, corporate finance encompasses all transactions related to raising capital for business growth and sustainability. It also includes decisions related to fixed assets and capital structure.
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