What will be optimal upper cash limit

Assignment Help Financial Management

Reference no: EM131506482

HotFoot Shoes would like to maintain its cash account at a minimum level of $39,000 but expects the standard deviation in net daily cash flows to be $3,400, the effective annual rate on marketable securities to be 3.1 percent per year, and the trading cost per sale or purchase of marketable securities to be $340 per transaction. What will be its optimal upper cash limit? (Use 365 days a year. Do not round intermediate calculations and round your answer to 2 decimal places.)

Reference no: EM131506482

Questions Cloud

Trust qualify for the marital deduction when bob funds : Will this trust qualify for the marital deduction when Bob funds it?

What amount of additional funds will wall-e need : what amount of additional funds will Wall-E need from external sources to fund the expected growth?

What will be its optimal cash return point : What will be its optimal cash return point?

Find annual effective interest rate gained by sinking fund : John takes out a loan for L and agrees to pay it back in 20 years using the sinking fund method. Find annual effective interest rate gained by the sinking fund.

What will be optimal upper cash limit : What will be its optimal upper cash limit?

Purchase your dream home : You are going to purchase your dream home.

What is the effective annual rate of return on a bond : What is the effective annual rate of return on a bond that has a holding period return of 10%, assuming it pays coupons semi-annually?

Semiannual coupons is trading with a yield to maturity : Suppose a seven-year, $1,000 bond with a 7.8% coupon rate and semiannual coupons is trading with a yield to maturity of 6.61%.

Estimate project cash flows and compute net present value : Assume a 10 percent weighted average cost of capital. Estimate the project cash flows, and compute Net Present Value.

User Account

All Pages