BNQ Bank operates a network of automated teller machines (ATMs). Cash withdrawals at an ATM average about 80 TL with a standard deviation of 16 TL. The bank estimates that the fixed cost of filling an ATM with cash is about 100 TL regardless of the amount of cash put in. Average number of cash withdrawals is about 150 per day. a. How much cash should the bank keep at an ATM if its annual cost of money is 10% and they want to make sure that 95% of the customers can find money available at an ATM when they want to withdraw money? b.How often should the bank replenish an ATM? What is the total annual filling and the cost of money kept in ATMs? c. What will be the percentage increase in the total cost of changing the optimal replenishment time to a schedule based on weekly deliveries (e.g. once a week, once every two weeks, etc
BNQ Bank operates a network of automated teller machines (ATMs). Cash withdrawals at an ATM average about 80 TL with a standard deviation of 16 TL. The bank estimates that the fixed cost of filling an ATM with cash is about 100 TL regardless of the amount of cash put in. Average number of cash withdrawals is about 150 per day.
a. How much cash should the bank keep at an ATM if its annual cost of money is 10% and they want to make sure that 95% of the customers can find money available at an ATM when they want to withdraw money?
b.How often should the bank replenish an ATM? What is the total annual filling and the cost of money kept in ATMs?
c. What will be the percentage increase in the total cost of changing the optimal replenishment time to a
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 7 images
