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You Need to Decide Whether Your Firm Should Transfer Funds

Question 70

Multiple Choice

You need to decide whether your firm should transfer funds from a deposit account to a transfer account via EDT that will cost $2 or via a wire transfer that will cost $20.It is a Friday so the wire transfer will save you 3 days of float.If your cost of capital is 8%,then how large must the transfer be in order to be indifferent between the wire and the ADT? round to the nearest dollar.


A) $82,125
B) $30,417
C) $27,375
D) $3,042

Correct Answer:

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