Hi expart Provide correct answer not use chatgpt Veggie Burgers, Inc., would like tomaintain its cash account at aminimum level of $246,400; butexpect the standard deviation in netdaily cash flows to be $13,600; theeffective annual rate on marketablesecurities to be 4.8 percent per year,and the trading cost per sale orpurchase of marketable securities to be$28 per transaction.What will be its optimal cash returnpoint?

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Answered: Veggie Burgers, Inc., would like to…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter14: Capital Structure Management In Practice

Section: Chapter Questions

Problem 27P

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Hollywood Shoes would like to maintain their cash account at a minimum level of $51,000, but expect the standard deviation in net daily cash flows to be $4,100; the effective annual rate on marketable securities to be 6.25 percent per year; and the trading cost per sale or purchase of marketable securities to be $110 per transaction. What will be their optimal upper cash limit? (Round your answer to the nearest dollar amount.) $55,100 $72,328.32 $111,859.83 $74,575.50
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