Answer the given problem

Hain your answer Optimal cash balance. The Madatung Corporation plans to have PI million in steady cash outlays for next year. The firm believes that it will face an opportunity interest rate of 15% and will incur a cost of P200 each time it borrows ( or withdraws). Required: Using the Baumol model; 1. Determine the transactions demand for cash (the optimal borrowing or withdrawal lot size) for Madatung Company. 2. What will be the cash cycle for the firm (in days)? 3. What would be the average cash balance for the firm? 4. Compute the total relevant cost of cash balance