ON THE OPTIMAL SPACING OF CURRENCY DENOMINATIONS

Authors
VANHOVE L HEYNDELS B
Citation
L. Vanhove et B. Heyndels, ON THE OPTIMAL SPACING OF CURRENCY DENOMINATIONS, European journal of operational research, 90(3), 1996, pp. 547-552
Citations number
6
Categorie Soggetti
Management,"Operatione Research & Management Science
Journal title
European journal of operational research → ACNP
ISSN journal
03772217
Volume
90
Issue
3
Year of publication
1996
Pages
547 - 552
Database
ISI
SICI code
0377-2217(1996)90:3<547:OTOSOC>2.0.ZU;2-T
Abstract
Existing theoretical evidence on optimal currency spacing is fragmenta ry and, to some extent, contradictory. This note brings together the p ieces and tries to solve the puzzle. It shows that if the spacing of d enominations is uniform, then the average number of notes and coins ex changed in a transaction can be minimized by spacing denominations apa rt by a factor of two, even when allowing for overpayment and the retu rn of change.