A

Average daily collection of New Wave $0.30

Size of average remittance $(750)

Average savings $(52,000)

Average cash balance $(127,250)

Saving a new wave, if the alternative is $52,000

chosen

Annual rate of return $0.05

Annual opportunity cost of maintaining $2,600

current cash

Processing cost of each check $0.30

Number of transfer $540

Cost of each transfer $0.35

Total annual expected cost $351

D
Total annual expected cost of new $351
system

Size of average remittance of current $750

system

Number of transfers $540

Net gain as a result of reducing the $215,460

cost