Question
Your company keeps a minimum cash balance of $10 million, which earns an average annual interest rate of 3.5%. Your company WACC is 8.5%. What
Your company keeps a minimum cash balance of $10 million, which earns an average annual interest rate of 3.5%. Your company WACC is 8.5%. What is the NPV of keeping this $10 minimum cash balance indefinitely?
| A | $3.50 million | |
| B | -$3.5 million | |
| C | -$5.88 million | |
| D | $4.12 million | |
| E | -$4.12 million |
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Modern Equity Investing Strategies
Authors: Anatoly B Schmidt
1st Edition
9811239495, 978-9811239496
