Maggie Wants to Open a Checking Account That Will Be $\$ 300$

question 136

Essay

Maggie wants to open a checking account that will be the least expensive given her normal financial transactions.She typically writes 15 checks a month and uses an ATM 35 times a month.Her minimum checking balances falls to about $350 in an average month.Which of the following accounts would be least expensive for Maggie? (Show all your work.)
Account A:
- No monthly fee is charged if a minimum balance of at least $\$ 300$ is maintained.
- A $\$ 5.00$ fee is charged in any month the minimum balance falls below $\$ 300$ .
- An ATM fee of $\$ 0.10$ per transaction is charged on all transactions.
Account B:
- No monthly fee is charged if a minimum balance of at least $\$ 500$ is maintained.
- A $\$ 3.00$ fee plus $\$ 0.10 /$ check is charged in any month the minimum balance falls below $\$ 500$ .
- There is no ATM fee on transactions.

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Definitions:

Transactions

Economic events that affect the financial position of a company, involving the transfer of value between two or more entities.

Stockholder

An individual or entity that owns shares in a corporation, giving them ownership interest and possibly dividends.

Economic Activities

Actions that involve the production, distribution, and consumption of goods and services in an economy.

Measurement System

The collection of units of measurement and rules relating them to each other, used to quantify physical quantities.