Speaker’s Clearinghouse must disburse sweepstakeschecks to winners in four different regions of the country:Southeast (SE), Northeast (NE), Far West (FW), andMidwest (MW). The average daily amount of the checkswritten to winners in each region of the country is as follows:SE, $40,000; NE, $60,000; FW, $30,000; MW, $50,000.Speaker’s must issue the checks the day they find out acustomer has won. They can delay winners from quicklycashing their checks by giving a winner a check drawn onan out-of-the-way bank (this will cause the check to clearslowly). Four bank sites are under consideration: FrosbiteFalls, Montana (FF), Redville, South Carolina (R), PaintedForest, Arizona (PF), and Beanville, Maine (B). The annualcost of maintaining an account at each bank is as follows:FF, $50,000; R, $40,000; PF, $30,000; B, $20,000. Eachbank has a requirement that the average daily amount ofchecks written cannot exceed $90,000. The average numberof days it takes a check to clear is given in Table 22. Assumingthat money invested by Speaker’s earns 15% per year, whereshould the company have bank accounts, and from whichbank should a given customer’s check be written?
Speaker’s Clearinghouse must disburse sweepstakes
checks to winners in four different regions of the country:
Southeast (SE), Northeast (NE), Far West (FW), and
Midwest (MW). The average daily amount of the checks
written to winners in each region of the country is as follows:
SE, $40,000; NE, $60,000; FW, $30,000; MW, $50,000.
Speaker’s must issue the checks the day they find out a
customer has won. They can delay winners from quickly
cashing their checks by giving a winner a check drawn on
an out-of-the-way bank (this will cause the check to clearslowly). Four bank sites are under consideration: Frosbite
Falls, Montana (FF), Redville, South Carolina (R), Painted
Forest, Arizona (PF), and Beanville, Maine (B). The annual
cost of maintaining an account at each bank is as follows:
FF, $50,000; R, $40,000; PF, $30,000; B, $20,000. Each
bank has a requirement that the average daily amount of
checks written cannot exceed $90,000. The average number
of days it takes a check to clear is given in Table 22. Assuming
that money invested by Speaker’s earns 15% per year, where
should the company have bank accounts, and from which
bank should a given customer’s check be written?
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
