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Compute the current opportunity cost is

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Point 1: Zero - balance account - Union Company is considering establishment of a zero balance account. The firm currently maintains an average balance of $420,000 in its disbursement account. As compensation to the bank for maintaining the zero-balance account, the firm will have to pay a monthly fee of $1,050 and maintain a $296,000 non-interest earning deposit in the bank. The firm currently has no other deposits in the bank. Evaluate the proposed zero-balance account, and make a recommendation to the firm, assuming that it has an opportunity cost of 12.4%.

Question 1: Compute The current opportunity cost is

Reference no: EM132490225

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