Question

What are the differences between economic investment and financial investment (giving examples for each of them)?

Answer 1

-- Financial investment takes into consideration all purchase undertaken for financial benefits; and on contrast the economic investment takes into consideration only purchase of newly created capital items.

-- Economic investment causes a creation and expansion of business enterprises. In economic investment the resources will be invested in activities where the benefits excess of the initial costs. The finance investment is a monetary asset purchased that can provide income in the future or may be sold later at a higher price for a profit

-- Example of economic investments are new machine, new plant, upgrading new machine, etc. Examples of financial investment are derivatives, mutual funds, stocks, etc.