Bavarian Sausage Cash Transfer
Bavarian Sausage needs to transfer $250,000 from its deposit account into its concentration account. The company could do it with an EDT which would cost $1.50 or a wire transfer for $17. The wire transfer would result in the funds being deposited in the concentration account 2 days earlier. The firm's opportunity cost is 10% and we assume a 360 day year.
-What is the benefit for Bavarian Sausage from using the wire transfer?
A) $138.89
B) $69.44
C) $109.57
D) $53.61
Correct Answer:
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