Watkins Resources faces a smooth annual demand for cash of $1.69 million, incurs transaction costs of $66 every time the firm sells marketable...

Watkins Resources faces a smooth annual demand for cash of $1.69 million, incurs transaction costs of $66 every time the firm sells marketable securities, and can earn 2.8 percent on its marketable securities. What will be its optimal cash replenishment level?

The answers on the site are incorrect.