The Eliot Co

question 47

Multiple Choice

The Eliot Co.needs $185,000 a week to pay bills.The standard deviation of the weekly disbursements is $17,600.The firm has established a lower cash balance limit of $75,000.The applicable interest rate is 5.5 percent and the fixed cost of transferring funds is $47.Based on the BAT model,what is the optimal initial cash balance?

• A)$90,668
• B)$97,515
• C)$104,141
• D)$128,224
• E)$136,509

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Definitions:

Seligman

Martin E.P. Seligman, a psychologist known for his work on positive psychology, learned helplessness, and theories on happiness and well-being.

Symptoms

Physical or mental features that are regarded as indicating a condition or disease.

Token Economy

A behavior modification method that uses tokens as rewards for desired behaviors, which can be exchanged for privileges or goods.

Reinforcers

Stimuli that increase the likelihood of a behavior being repeated.