Which of the following capital is required for funding the day-to-day operations of the business?

Working capital

The correct answer is option 3- Working capital.

Working capital is required for funding the day-to-day operations of the business.

Working capital decision- Short-term investment decisions (also called working capital decisions) are concerned with the decisions about the levels of cash, inventory and receivables. These decisions affect the day-to-day working of a business. These affect the liquidity as well as profitability of a business. Efficient cash management, inventory management and receivables management are essential ingredients of sound working capital management.