MANAGEMENT

Detailed explanation-1: -Short term Investment decision is the decision that is taken in financial management which affects the liquidity as well as the profitability of business. Was this answer helpful?

Detailed explanation-2: -Working capital affects both the liquidity as well as profitability of a business. As the amount of working capital increases, the liquidity of the business increases. However, since current assets offer low return, with the increase in working capital the profitability of the business falls.

Detailed explanation-3: -The liquidity decision is concerned with the management of the current assets, which is a pre-requisite to long-term success of any business firm. This is also called as working capital decision.

Detailed explanation-4: -Short term investment decisions are the decisions related with the bills receivables, inventories, levels of cash and debtors etc. These decisions are also known as working capital decisions.

Detailed explanation-5: -Short term investment decisions are also called working capital decisions. These are concerned with the decisions about the inventories, debtors, bills receivable and level of cash etc. It affects the day to day working of the business.