Determining the right amount of shortterm, liquid investments. Ella and Aaron Martin together earn approximately $92,000 a year after taxes. Through an inheritance and some wise investing, they also have an investment portfolio with a value of almost $200,000.

a. How much of their annual income do you recommend the Martins hold in some form of liquid savings as reserves? Explain.

b. How much of their investment portfolio do you recommend they hold in savings and other short-term investment vehicles? Explain.

c. How much, in total, should they hold in short-term liquid assets? L01