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Aggressive versus conservative seasonal funding strategy Dynabase Tool has forecast its total funding requirements for the coming year as shown in the following table: 2.
Aggressive versus conservative seasonal funding strategy Dynabase Tool has forecast its total funding requirements for the coming year as shown in the following table: 2. Divide the firm's monthly funding requirement into (1) a permanent component and (2) a seasonal component, and find the monthly average for each of these components b. Describe the amount of long-term and short-term financing used to meet the total funds requirement under (1) an aggressive funding strategy and (2) a conservative funding strategy. Assume that under the aggressive strategy, long-term funds finance permanent needs and short-term funds are used to finance seasonal needs. C. Assuming that short-term funding costs 5% annually and that the cost of long-term funding is 10% annually use the averages found in part a to calculate the total cost of each of the strategies described in part b. Assume that the firm can earn 3% on any excess cash balances d. Discuss the profitability-risk trade-offs associated with the aggressive strategy and those associated with the conservative strategy a. Divide the firm's monthly funding requirement into (1) a permanent component and (2) a seasonal component, and find the monthly average for each of these components. The monthly average of the firm's permanent funding requirement is $0 (Round to the nearest dollar) Data Table (Click on the icon here in order into a spreadsheet copy the contents of the data table below Month January February March April May June Amount $2,000,000 52 000 000 $2,000,000 $3,000,000 $6,000,000 $8,000,000 Month July August September October November December Amount $11,000,000 $14,000,000 $9,000,000 56.000.000 $3.000.000 $3.000.000 Enter your answer in the answer box and then click Check Answer. 9 parts remaining
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