Question: DE TE RM IN IN G TH E RIGH T AM OUN T O F SH O RTTE RM , LIQU ID IN E STM

DE TE RM IN IN G TH E RIGH T AM OUN T O F SH O RTTE RM , LIQU ID IN E STM E N TS. Leo and Ava Bryant together earn approximately $92,000 a year after taxes. Through an inheritance and some wise investing, they also have an investment portfolio with a value of almost

$200,000.

a. How much of their annual income do you recommend the Bryants hold in some form of liquid savings as reserves? Explain.

b. How much of their investment portfolio do you recommend they hold in savings and other short-term investment vehicles? Explain.

c. How much, in total, should they hold in short-term liquid assets? lo1

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