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(Cash Management) 15% The variance of the daily cash flows for the Pele Bicycle Shop is $960,000. The opportunity cost to the firm of holding
(Cash Management) 15% The variance of the daily cash flows for the Pele Bicycle Shop is $960,000. The opportunity cost to the firm of holding cash is 7 percent per year. The fixed cost of buying and selling securities is $500 per transaction. What should be the target cash level and the upper limit (using Miller-Orr model) if the tolerable lower limit has been established as $150,000
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