HJK Corporation's demand for cash during a year's time is $500,000. Each time HJK sells securities to raise cash, it pays a brokerage commission of $10. The interest rate HJK earns on the securities is 4% per year 9 How much in securities should HJK sell I each time it sells securities to minimize its costs of holding the cash instead of the securities and to minimize its brokerage commissions? *
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- [Do not use peso sign and comma. Ex: If your answer is P1,000. just write 1000.] Smart Company is expecting temporary idle cash. Hence, it is considering investing in marketable securities. Assume that the fixed cost of selling marketable securities is P10 per transaction and the interest rate on marketable securities is 6% per year. The company estimates that it will make cash payments of P12,000,000 over a 1-month period. What is the average cash balance (rounded to the nearest peso)? Your answer1. Why are financial markets so keenly regulated? Explain the rational for the regulation 2. A. Nii Laryea purchased a T-bill with a GHC10,000 par value for GHC9,465. Onehundred days later, Nii sells the t-bill for GHC9,650. Assuming 365 days in a year,what is Nii Laryea’s expected annualized yield from the transaction? 3. Endicott Enterprises Inc. has twenty years remaining on Ghc 1,000 par valuesemiannual coupon bonds paying a coupon of Ghc40. If the yield to maturity on thesebonds is 6% per year, what is the current price? 4. Can a borrower in Ghana face penalties if a loan is prepaid? Discuss two reasons whya borrower would decide to bear this cost. 5.Give an account of the impact of the Coronavirus (COVID 19) on the financial marketswith illustrations from two (2) global financial centres known to you.An investment bank sells securities under a repurchase agreement for $800.438 million and buys them back in 7 days for $800.568 million. What is the repo's single payment yield?Report your answer in % to the nearest 0.01%;
- Suppose NewBank decides to invest $273 million in30-day T-bills. The T-bills are currently trading at$4,981 (including commissions) for a $4,940 face valueinstrument. How many T-bills do they purchase? Whatdoes the balance sheet look like?Buccaneer, Inc., has determined that it needs $10 million in cash per week. If Buccaneer needs additional cash, it can sell marketable securities, incurring a fee of $100 for each transaction. If Buccaneer leaves funds in its marketable securities, it expects to earn approximately 0.2% per week on their investment. 1. How much is the weekly opportunity cost of cash? (Use a number, must be in decimal form. eg. 6.3%/100, encode 0.063 , no commas, no currency, no space) * 2. How much is the total demand for cash per week? (Use a number, no decimal value, no commas, no currency, no space) *mekmek Corporation uses the Baumol Cash Model to determine its optimal cash balance. For the coming year, the expected cash disbursement total to P432,000. The interest rate on marketable securities is P8 per transaction. Using 5% carrying cost rate, what is the optimal cash balance of the company? A. 1,175.76 B. 5,878.78 C. 11,757.55 D. 142,000
- Buccaneer, Inc., has determined that it needs $10,000,000 in cash per week. If Buccaneer needs additional cash, it can sell marketable securities, incurring a fee of $100 for each transaction. If Buccaneer leaves funds in its marketable securities, it expects to earn approximately 0.2% per week on their investment. Using the economic order quant ity model, how much cash should Buccaneer raise from selling securities each week to minimize its costs of cash?PROBLEM Buccaneer, Inc., has determined that it needs $10 million in cash per week. If Buccaneer needs additional cash, it can sell marketable securities, incurring a fee of $100 for each transaction. If Buccaneer leaves funds in its marketable securities, it expects to earn approximately 0.2% per week on their investment. 1. How much is the weekly opportunity cost of cash? (Use a number, must be in decimal form. eg. 6.3%/100, encode 0.063 , no commas, no currency, no space) * 2. How much is the total demand for cash per week? (Use a number, no decimal value, no commas, no currency, no space) * 3. How much is the cost per transaction? (Use a number, no decimal value, no commas, no currency, no space) * 4. Using the Baumol Model, how much cash should Buccaneer raise from selling securities each week to minimize its costs of cash? (Use a number, no decimal value, no commas, no currency, no space) * PLEASE ANSWER ALL QUESTIONS. THANK YOUNational Co.’s evaluation of its cash outlay required indicates that it needs 500,000 for the year. Regardless of the amount. It incurs 30 to convert marketable securities to cash. The marketable securities earn an annual rate of 3%. Potter does not maintain buffer cash 1. How much is the optimal transaction size? 2. How much is the average cash balance? 3. How mich is the annual holding cost as a result of keeping cash on hand? 4.How many transactions should be there in a year? 5.How much is the total annual cost of cash?
- Stellar Shoes would like to maintain their cash account at a minimum level of $25,000, but expects the standard deviation in net dally cash flows to be $2,000; the effective annual rate on marketable securities to be 5 percent per year, and the trading cost per sale or purchase of marketable securities to be $100 per transaction. What will be their optimal upper cash limit? Multiple Choice $114,277.02 $38,092.34 $27,000 $64,27702The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can sell marketable securities, incurring a fee of P300 for each transaction. If Sandbox leaves its funds in marketable securities, it expects to earn approximately 0.50% per month on their investment. If Sandbox gets a cash infusion of P1 million each time it needs cash, what are the holding costs associated with its cash investment?The following formula is used in determining its optimal level of cash. Assume that the fixed cost of selling marketable securities is P10 per transaction and the interest rate on marketable securities is 6% per year. The company estimates that it will make cash payments of P12,000 over a 1-month period. What is the average cash balance (rounded to the nearest peso)? (check the attached photo) choose the letter of the correct answer a. P1,732.00b. P3,464.00c. P6,928.00d. P8,660.00e. P15,588.00