The trading cost per sale or purchase of marketable


HotFoot Shoes would like to maintain its cash account at a minimum level of $37,000 but expects the standard deviation in net daily cash flows to be $3,200, the effective annual rate on marketable securities to be 3.3 percent per year, and the trading cost per sale or purchase of marketable securities to be $320 per transaction.

What will be its optimal upper cash limit?

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Financial Management: The trading cost per sale or purchase of marketable
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