Anne Teak, the financial manager of a furniture manufacturer, is considering operating a lock-box system. She forecasts that 500 payments a day will be made to lock boxes with an average payment size of $2,500. The bank's charge for operating the lock boxes is $0.30 a check. The interest rate is 0.011% per day. a. If the lock box makes the cash available 2 days earlier, calculate the net daily advantage of the system. (Do not round intermediate calculations.) Net daily advantage 191

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Solve for A). (NEt daily advantage)

Anne Teak, the financial manager of a furniture manufacturer, is considering operating a lock-box system. She forecasts that
500 payments a day will be made to lock boxes with an average payment size of $2,500. The bank's charge for operating
the lock boxes is $0.30 a check. The interest rate is 0.011% per day.
a. If the lock box makes the cash available 2 days earlier, calculate the net daily advantage of the system. (Do not round
intermediate calculations.)
Net daily advantage
191
Transcribed Image Text:Anne Teak, the financial manager of a furniture manufacturer, is considering operating a lock-box system. She forecasts that 500 payments a day will be made to lock boxes with an average payment size of $2,500. The bank's charge for operating the lock boxes is $0.30 a check. The interest rate is 0.011% per day. a. If the lock box makes the cash available 2 days earlier, calculate the net daily advantage of the system. (Do not round intermediate calculations.) Net daily advantage 191
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