An Employee of Macro

Multiple Choice

An employee of Macro.com Corporation is paid $5,000 a month, which she spends regularly throughout the month until she has a zero balance in her checking account at the end of the month.If the corporation changes to a semimonthly payroll schedule, how will the employee's average cash balance change? Assume she does not change her spending pattern when she is now paid twice a month.

A) It changes from $5,000 to $2,500 per month.
B) It changes from $2,500 to $1,250 per month.
C) It changes from $1,250 to $625 per month.
D) It changes from $500 to $250 per month.