Use the Following Information to Answer the Question: a Current

question 11

Multiple Choice

Use the following information to answer the question: A current deposit account requires a minimum balance of $500 if annual interest of 5% is to be earned monthly on its deposits.An account holder has maintained an average balance of $300 for the first nine months of the year and $800 for the last three months of the year.She has written an average of 20 cheques a month and is not charged for these services.However, it costs the bank $0.02 to process each cheque.What is the average return earned (both explicit and implicit) by the account holder over the full year?

• A)2.98%
• B)3.48%
• C)4.28%
• D)4.79%

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Definitions:

Production Function

The relationship between the quantity of inputs used to make a good and the quantity of output of that good.

Inputs

Resources such as labor, materials, and capital that are used in the production process to create goods or services.

Output

The total quantity of goods or services produced within a given period by a firm, industry, or country.

Population Growth Rates

Measures the increase in a population's size within a specific time frame, considering factors such as births, deaths, and migration.