Illustrate miller-orr model recognises, Financial Management

Q. Illustrate Miller-Orr model recognises?

The Miller-Orr model recognises which cash balance requirements are likely to fluctuate and that active management is required in responding to these fluctuations. Especially attention is paid to the variability (or variance) of interest rates, cash flows and the transaction costs of adjusting cash balances. It is the variability of cash balances which is crucial to understanding cash management since this will depend directly on understanding how Frantic's operations (basically sales and production) vary. For an unstable business it is probable that large cash balances will need to be kept. Miller-Orr suggests a simple formula to estimate this although the formula itself is limited by the assumptions on which it rests.

Posted Date: 7/12/2013 2:26:18 AM | Location : United States

Related Discussions:- Illustrate miller-orr model recognises, Assignment Help, Ask Question on Illustrate miller-orr model recognises, Get Answer, Expert's Help, Illustrate miller-orr model recognises Discussions

Write discussion on Illustrate miller-orr model recognises
Your posts are moderated
Related Questions
The burden of a tax is shared by producers and consumers.  Under what conditions will consumers pay most of the tax?  Under what conditions will producers pay most of it?  What det

Issuer's Considerations Cash Flows: Issuers may consider the period for which the funds are required and try to spread the borrowings in a way to minimize the costs. Generally,

Significance of Secondary Markets: High liquidity and constant demand in the market need a diversified investor base with different preferences of demand, maturity and risk. Ap

Lenders Lenders are concerned to receive payment of interest and ultimate re-payment of capital. They don't share in the upside of very successful organisational strategies as

Q. How are the HIBOR, HSI and HSI futures related? The HIBOR and HSI are contrariwise related. So futures on HIBOR and HSI are as well inversely related. Display

Benefits of Issue of Securities Initial Public Offering (IPO) of securities gives instant recognition and visibility to the firm, helps to attract and retain skilled personnel,

Define the term- Future Cost and Historical Cost Future cost of capital refers to expected cost of funds to be raised to finance a project. In contrast, historical cost signifi

Call provision is the right of the issuer to call back and retire the issued bonds before the maturity date. The issuer may call the bond and retire the bond by paying

Bond management evolution to some extent is linked to the increased volatility of the interest rate term structures which is in existence since seventies. Bond valuatio

The issuers of ALBS are the financial subsidiaries of automobile manufacturers, commercial banks and other independent finance companies and small financial insti