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    Calculate the target level and upper limit for a cash management approach that uses the Miller and Orr model. What problems do you foresee if approach is implemented?

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    Wilson Products Ltd estimates that the standard deviation of its daily change in cash balance is $30000. The fixed cost of each withdrawal and injection of cash is $10 and the daily management yield on its investment is 0.0006. Wilson does not operate on an overdraft.

    Calculate the target level and upper limit for a cash management approach that uses the Miller and Orr model. What problems do you foresee if approach is implemented?

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    https://brainmass.com/business/cash-management/85208

    Solution Summary

    Target cash balance is computed for you and four problems are mentioned. No references.

    $2.19

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