Cash Management. A firm maintains a separate account for cash disbursements. Total disbursements are $100,000 per month
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Cash Management. A firm maintains a separate account for cash disbursements. Total disbursements are $100,000 per month spread evenly over the month. Administrative and transaction costs of transferring cash to the disbursement account are $10 per transfer. Marketable securities yield 1 percent per month. Determine the size and number of transfers that will minimize the cost of maintaining the special account.
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Related Book For
Study Guide To Accompany Fundamentals Of Corporate Finance
ISBN: 9780073012421
5th Edition
Authors: Richard Brealey, Stewart Myers, Alan Marcus
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