Delta Cables Ltd. earned a net profit of 50 crores. Atul, the finance manager of Delta Cables Ltd. wants to decide how to appropriate these profits. Which financial decision will help him in deciding it?

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Solution

Investment decision The investment decision relates to how the firm’s funds are invested in different assets. Investment decision may be long-term or short-term. Long-term investment decision is called capital budgeting decision and short-term investment decision is called working capital decision.

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