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The characteristic of a capital investment decision is an investment of long-term choices about which projects receive investment, whether to finance that investment with equity or debt, and when or whether to pay dividends to shareholders.

On the other hand, a short-term decision deal with the short-term balance of current assets and current liabilities; the focus here is on managing cash, inventories, and short-termborrowing and lending (such as the terms on credit extended to customers)

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