Suppose that your weekly cash expenses are $80. Every time you withdraw money from the automated teller
Question:
Suppose that your weekly cash expenses are $80. Every time you withdraw money from the automated teller at your bank, you are charged $.15. Your bank account pays interest of 3% annually.
a. How often should you withdraw funds from the bank?
b. What is the optimal-sized withdrawal?
c. What is your average amount of cash on hand?
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Related Book For
Fundamentals of Corporate Finance
ISBN: 978-1259024962
6th Canadian edition
Authors: Richard Brealey, Stewart Myers, Alan Marcus, Devashis Mitra, Elizabeth Maynes, William Lim
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