Get premium membership and access questions with answers, video lessons as well as revision papers.

Discuss 3 Classification of Investments

      

Discuss 3 Classification of Investments

  

Answers


Ruth
I. Mutually exclusive investments
These are alternative options which serve the same purpose and compete with each other.
if the firm is for instant considering three mutually project and one of them is undertaken
the other two will automatically be rejected irrespective of their profitability,
II. Independent investments.
These projects serve different purposes and do not compete with each other. If the firm is
considering five independent projects, all of them can be undertaken subject to their
profitability and availability of funds.
III. Contingent / complementary investments
These are dependent projects. One project is required in the implementation or operation
of another. This implies that the functioning of each project requires an input from the
other complementary project.
NatalieR answered the question on February 9, 2022 at 11:21


Next: Use the figure below to Calculate Quick (or Acid-Test) Ratio.
Previous: List the requirements which need to be fulfilled by methods used to assess the viability of an investment in capital budgeting

View More Financial Management I Questions and Answers | Return to Questions Index


Learn High School English on YouTube

Related Questions