Once each year, Smith Incorporation receives a $ 2 million payment of this amount, 700,000 S is needed for cash payments made during the next year. Each time Smith deposits money in its account, a charge of $2 is assessed to cover clerical costs. If Smith can hold marketable securities which yield 5 percent, and then convert these securities to cash at a cost of only the $ 2 deposit charge, what is the optimal cash transfer level according to the Baumol model