Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Baumol's Model - Optimal Cash Balance
An application of the EOQ is the Baumol's model which is inventory model to cash management. Its statements are as:
Beneath these assumptions the following model can be stated:
Whereas: C* is the optimal amount of cash to be raised via borrowing or via selling marketable securities.
b is the fixed cost of borrowing or of creation a securities trade
T is the net annual cash necessities
i is the chance cost of holding cash or like equals the interest rate at the cost of borrowing or marketable securities
The whole cost of holding the cash balance is equivalent to carrying or holding cost plus transaction costs and is specified via the following formulae as:
TC = ½ (Ci) + T/c (b)
Marginal cost of finance This is cost of new finances or additional cost a company has to pay to raise and use additional finance is given by: (Total cost of marginal finan
If you inherited $ 45,000 today and invested all of it in a security that paid a 7 percent rate of return, how much would you have in 25 years?
what are the qualitative factors to be considered when deciding on product mix
Role of Stock Exchange in Economic Development The Roles of Stock Exchange in Economic Development are as follow: 1. Raising Capital for Businesses The Stock Exchange
Attributes of venture capital Equity participation Venture Capital participates with direct purchase of shares or fixed return securities as debentures and prefere
A compnay can arrange for a secured loan amounting to 150,000,000 for one year at an interest rate of 18% per annum based on the initial balance of the loan. The lender also imposs
What are the characteristics of an efficient market? The word market efficiency refers to the speed, ease, and cost of trading securities. In a well-organized market, securitie
Profit maximization - Objectives of Business Entity Conventionally, this was considered to be the main goal of the firm. Profit maximization refers to getting the highest poss
Constant DPS plus Extra or Surplus 1. Beneath this policy a constant DPS is paid every year. Nonetheless extra dividends are paid in years of supernormal earnings. 2. It prov
How to compute the IRR of data
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd