A bank has its head office in the financial district in the middle of a city. It has six branches, three in the north of the city and three in the south all 5 km from the centre and spaced 3 km apart. The bank wishes to link all its branches via private leased lines but must decide between providing an individual line to each branch of via a number of inter-branch links and a smaller number of multiplexed lines to the centre. If a modem costs £100, a multiplexer/demultiplexer costs £200 and leased lines cost £100 per km per year to rent, suggest a design that will yield the most cost effective solution if the installation is to remain in operation for four years.

A bank has its head office in the financial district in the middle of a city. It has six branches, three in the north of the city and three in the south all 5 km from the centre and spaced 3 km apart. The bank wishes to link all its branches via private leased lines but must decide between providing an individual line to each branch of via a number of inter-branch links and a smaller number of multiplexed lines to the centre. If a modem costs £100, a multiplexer/demultiplexer costs £200 and leased lines cost £100 per km per year to rent, suggest a design that will yield the most cost effective solution if the installation is to remain in operation for four years.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter17: The Management Of Cash And Marketable Securities

Section: Chapter Questions

Problem 5P

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