Ans 1.

Value of a firm will depend on various finance functions/decisions. It can be expressed as:
V = f (I,F,D).
The finance functions are divided into long term and short term functions/decisions

Long term Finance Function Decisions
(a) Investment decisions (I): These decisions relate to the selection of assets in which funds will be invested by a firm. Funds procured from different sources have to be invested in various kinds of assets. Long term funds are used in a project for various fixed assets and also for current assets. 

(b) Financing decisions (F): These decisions relate to acquiring the optimum finance to meet financial objectives and seeing that fixed and working capital are effectively managed.
(c) Dividend decisions(D): These decisions relate to the determination as to how much and how frequently cash can be paid out of the profits of an organisation as income for its owners/shareholders. The owner of any profit-making organization looks for reward for his investment in two ways, the growth of the capital invested and the cash paid out as income; for a sole trader this income would be termed as drawings and for a limited liability company the term is dividends.
Short- term Finance Decisions/Function
Working capital Management (WCM): Generally short term decision are reduced to management of current asset and current liability (i.e., working capital Management)