Question
Sherman Peabody earns a monthly salary of $2000, which he receives at the beginning of each month. He spends the entire amount each month, at
Sherman Peabody earns a monthly salary of $2000, which he receives at the beginning of each month. He spends the entire amount each month, at the rate of $67 per day. (Assume 30 days in a month.) The interest rate paid on bonds is 10 percent per month. It costs $4 every time Peabody sells a bond.
Using the information above compute the following:
Peabody should sell (switch) bonds nothing times per month because he can (minimize or maximize) his net profit by doing so. (Enter your response as an integer.)
The maximum net profit would be $__ nothing. (Enter your response as an integer.)
The optimal average of money holdings is $___ nothing. (Enter your response as an integer.)
(There is no bond data).
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