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 $5,400, the effective annual rate on marketable securities t be 6.1 percent per year, and the trading cost per sale or purchase of marketable securities to be $160 per transaction. What will be its optimal cash return point? (Use 365 days a year. Do not round intermediate calculations. Round your final answer to 2 decimal places.)

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 $5,400, the effective annual rate on marketable securities t be 6.1 percent per year, and the trading cost per sale or purchase of marketable securities to be $160 per transaction. What will be its optimal cash return point? (Use 365 days a year. Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter23: Other Topics In Working Capital Management

Section: Chapter Questions

Problem 11MC

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