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Silver Corporation is interested in making sure it has enough money to finance its assets. The company's total assets for the months of January

 

Silver Corporation is interested in making sure it has enough money to finance its assets. The company's total assets for the months of January through December are given in the following table (35 points). Month January February March April May June July August September October November December Total assets (S) $130,000 128,000 125,000 117,000 110,000 111,000 110,000 107,000 108,000 103,000 110,000 120,000 a. Find the average monthly seasonal and permanent funds requirement. b. What is the total cost of financing under the aggressive and conservative strategies? Assume short-term funds costs 4.5 percent and the interest rate for long-term funds is 12 percent. c. If the firm can earn 4% on the investment of any surplus balances how total cost of each of the strategies differ from costs calculated in part b. d. Discuss the profitability-risk trade-offs associated with the aggressive strategy and those associated with the conservative strategy.

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