Donaldson, Inc

Donaldson, Inc. spends $94,000 a week to pay bills and maintains a lower cash balance limit of $50,000. The standard deviation of the disbursements is $13,000. The applicable weekly interest rate is 0.045 percent and the fixed cost of transferring funds is $52. What is your optimal average cash balance based on the Miller-Orr model?

A) $78,778
B) $82,623
C) $231,969
D) $236,334
E) $247,868