A company spends on average €75,000 per week to pay its bills and maintains a lower cash balance limit of €40,000. The applicable interest rate is 6.12 percent and the fixed cost of transferring funds is €32. What is the optimal initial cash balance based on the BAT model
A company spends on average €75,000 per week to pay its bills and maintains a lower cash balance limit of €40,000. The applicable interest rate is 6.12 percent and the fixed cost of transferring funds is €32. What is the optimal initial cash balance based on the BAT model
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 16EB: Project Y cost $8,000 and will generate net cash inflows of $1,500 in year one, $2,000 in year two,...
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A company spends on average €75,000 per week to pay its bills and maintains a lower cash balance limit of €40,000. The applicable interest rate is 6.12 percent and the fixed cost of transferring funds is €32. What is the optimal initial cash balance based on the BAT model
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