MD Groceries Currently Sets Its Initial Cash Balance at $5,000

MD Groceries currently sets its initial cash balance at $5,000, which is depleted every four days. The current market rate of return is 4.5% per year. The firm pays $2.50 each time it replenishes its cash account. Use a 360-day year.

What are the trading costs for MD's decision regarding its cash balance?

A) $65.00 per year
B) $100.00 per year
C) $112.50 per year
D) $225.00 per year
E) $450.00 per year