4. 8. Interpreting Miller-Orr [LO 19.2] Based on the Miller-Orr model, describe what will happen to the

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4. 8.

Interpreting Miller-Orr [LO 19.2] Based on the Miller-Orr model, describe what will happen to the lower limit, the upper limit and the spread (the distance between the two) if the variation in net cash flow grows. Give an intuitive explanation for why this happens. What happens if the variance drops to zero?

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