Discuss what is the optimal transaction size for transfers

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For Leo, Inc. and according to the Baumol model, what is the optimal transaction size for transfers from marketable securities if the total cash needed for transactions annually is $7,569,000 and the company can hold marketable securities that yield 10 percent, and then convert these securities to cash at a cost of only $50 per transaction.

A.

$7,071

B.

$38,357

C.

$70,711

D.

$102,956

E.

$87,000

Reference no: EM131715509

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