Question
Following Baumol's cash model, what is the optimal cash balance Q* for a company given that the company's cash needs are 40,000 per week, transaction
Following Baumol's cash model, what is the optimal cash balance Q* for a company given that the company's cash needs are 40,000 per week, transaction costs for the year are 300 and the rate of interest forgone is 7%.
a.
178,285.74
b.
133,523.67
c.
134,907.38
d.
188,507.89
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Fundamentals Of Financial Management
Authors: James Van Horne, John Wachowicz
13th Revised Edition
978-0273713630, 273713639
