Cash position using the eoq model

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Reference no: EM131619655

AIA Inc. is looking to manage its cash position using the EOQ model. The company is consuming cash at the rate of $5800 per day, and is open for business 365 days in the year. Each time the firm sells securities to obtain the cash, it costs them $200. The interest rate is 2.60%. What are the total costs (annual storage costs + annual order costs) associated with the EOQ?

Reference no: EM131619655

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