How much of their annual income do you recommend the Martins hold in some form of liquid savings as reserves? Explain. b. How much of their investment portfolio do you recommend they hold in savins and other short-term investment vehicles? Explain. c. How much, in total, should they hold in short-term liquid assets?

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter4: Managing Your Cash And Savings
Section: Chapter Questions
Problem 8FPE: Determining the right amount of short-term, liquid investments. Ella and Aaron Martin together earn...
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Ella and Aaron Martin together earn approximately $92,000 a year after taxes. Through an inheritance and some wise investing, they also have an investment portfolio with a value of almost $200,000.

a. How much of their annual income do you recommend the Martins hold in some form of liquid savings as reserves? Explain.

b. How much of their investment portfolio do you recommend they hold in savins and other short-term investment vehicles? Explain.

c. How much, in total, should they hold in short-term liquid assets?

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