Your Cash Manager Is Currently Using Wire Transfer to Obtain

question 93

Multiple Choice

Your cash manager is currently using wire transfer to obtain collections from distant locations each time that the cash accumulates to $50,000.Evaluate the financial logic of this policy if the wire transfer costs $20, saves three days of mail time, and interest rates average 7 percent annually.

• A)Stop the policy; $8.77 is lost with each transfer.
• B)Stop the policy unless the transfer amount is increased to approximately $65,200.
• C)Continue the policy at the current transfer amount.
• D)Improve policy by reducing transfer amount to $34,800.

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Definitions:

Value of K

In different contexts, it can refer to a specific constant or variable value used in mathematical equations or algorithms.

Mean Absolute Percentage Error

A measure used to evaluate the accuracy of a forecasting method by calculating the average absolute percent difference between predicted and observed values.

Sales Details

Information regarding the transactions, volumes, and characteristics of sales within a business or market.

Value of K

A specific value or constant used in calculations, varying in meaning across different mathematical or scientific contexts.