Bahari Ltd. has the standard deviation of its daily net cash flow estimated at Sh.68, 250. The company maintains minimum cash balance Sh.500, 000. The company's...

      

Bahari Ltd. has the standard deviation of its daily net cash flow estimated at Sh.68, 250. The company
maintains minimum cash balance Sh.500, 000. The company's transaction cost is Sh.360 from the
money marker. The rate interest for the marketable securities is 9.865% per annum. The company
uses the Miller-Oir model to set its target cash balance.
Assume 365 days a year.
Required:
(i) The company's return point.
(ii) Upper cash limit.
(iii) The average cash balance.

  

Answers


Kavungya
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Kavungya answered the question on April 28, 2022 at 06:30


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