2. Your firm processes 50,000 checks each year with an average face.value of $50 per check....

Transcribed Image Text:

2. Your firm processes 50,000 checks each year with an average face.value of $50 per check. Col- lecting on these checks requires two days of mail float, three days of processing float, and one day of availability float. At an opportunity cost rate of 4 percent, what is the opportunity cost of collection float? What would the opportunity cost of collection float be if you achieved check collection efficiencies that lowered mail float to one day, processing float to two days, and avail- ability float to zero days? 2. Your firm processes 50,000 checks each year with an average face.value of $50 per check. Col- lecting on these checks requires two days of mail float, three days of processing float, and one day of availability float. At an opportunity cost rate of 4 percent, what is the opportunity cost of collection float? What would the opportunity cost of collection float be if you achieved check collection efficiencies that lowered mail float to one day, processing float to two days, and avail- ability float to zero days?

Answer rating: 100% (QA)

To calculate the opportunity cost of collection float we first need to determine the total float per... View the full answer