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Gemini Inc.'s optimal cash transfer amount, using the Baumol model, is $60,000.The firm's fixed cost per cash transfer of marketable securities to cash is $180.In addition, the total estimated cash costs (transfers and carrying cost) for the firm, based on 16 transactions per year, are $5,760.On what opportunity cost of holding cash was this analysis based?
Principal
The original sum of money borrowed in a loan, or the amount of the investment itself.
Interest Components
Elements that contribute to the total interest calculation, often including principal, rate, and time.
Per Annum
Annually or per year, often used to describe rates or amounts calculated over the span of a year.
Maturity Value
The total amount that will be paid to an investor at the end of a fixed-term investment, including the principal and interest.
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