What exactly is finance and how does it differ from micro and macro? I want to learn more about how businesses are run and how the economy actually works. Would the sequence above allow me to do that?
If VCE Accounting as anything to go by, then I don't think I'm particularly interested in Accounting. I have a friend who did Accounting in Year 12 this year, and the stuff he did looked pretty dull (no offence to all the Accounting lovers out there!). But I'm curious: what exactly is the difference between Accounting, Finance, and Economics?
Finance is the study of how assets are allocated using different financial models. It involves studying the different types of financial markets (e.g. money market, forex market, stock market, bond market, etc.), financial securities, and financial institutions. It also involves analysing financial risk, credit risk, interest risk, and other macroeconomic variables and incorporating them on different asset pricing models. In later years you can either branch out to do personal finance (wealth management and financial planning) or corporate finance (dealing with capital structures and funding sources of companies).
Finance 1 gives a foundational knowledge on all the higher finance subjects. Macroeconomics involves analysis of the performance and behaviour of the economy as a whole, working with the concepts of inflation, interest rates, money supply, monetary and fiscal policy, GDP, etc. Microeconomics, meanwhile, studies the behaviour of producers and consumers under both perfect and imperfect competition, as well as the role of government in an economy, game theory, and resource allocation. Given that you want to know more of how business work with a little bit of economics, I would say that the FINANCE 1 -- BUS. FIN -- CORP. FIN track would suit you well. Read more about each subject in the Handbook. Otherwise, you can do a Macro breadth track.
Also, VCE Accounting is very different than ARA; I think it's actually closer to IFA than ARA. I like studying Accounting, but I really get why people see Accounting as boring (maybe because it actually is). Accounting is the process of identifying, recording, measuring, and communicating economic events and financial transactions of a firm to a range of users for their decision-making needs.
There is definitely an intersection among finance, economics, and accounting. Financial Accounting is basically reporting to external entities. It's rigid, standard-based, and heavily audited. Management Accounting deals with cost management, cost-based economic decisions, performance appraisal, and budgeting, among others. It's not standard-based because it's only released for managers to use (hence, management accounting).
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