Suppose the nominal interest rate is 3 percent the cost of, Operation Management

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Suppose the nominal interest rate is 3 percent the cost of

Suppose the nominal interest rate is 3 percent, the cost of going to the ATM is $1.50, you have a 12 percent probability of having your cash lost or stolen, and you spend $5 each day. a. What is your total cost of holding cash as a function of the number of days between trips to the ATM? b. How often will you go to the ATM to minimize your costs?

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Operation Management: Suppose the nominal interest rate is 3 percent the cost of

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