The standard deviation of weekly net cash flows for the, Ask an Expert

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The standard deviation of weekly net cash flows for the bakery is $1,000. Transactions costs sell securities to replenish cash is $25 each. The annualized interest rate earned on its marketable securities is 2.0%. Management likes to keep $2,000 as its minimum balance. Using the Miller-Orr model.

a. What is the target cash balance C?

b. What is the average cash balance?

c. What is the upper cash balance ?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92810104

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