AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him. Characters in the case : AS Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options. To determine: The type of account is better for A to avoid or minimize fee on balance requirement of checking account. Introduction: Checking account balance requirements: Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800-$1,200 a service fee is applicable.

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Answer 1

Question

Chapter 5, Problem 7FPC

a

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The type of account is better for A to avoid or minimize fee on balance requirement of checking account.

Introduction:

Checking account balance requirements:Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800-$1,200 a service fee is applicable.

b

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The way A could work to avoid monthly fee of his account.

Checking account balance requirements: Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800 to $1,200 a service fee is applicable.

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You want to open a checking account with a $500 deposit. You estimate you will write 16 checks a month and use an ATM from other banks about twice a week. Bank A charges $1.40 per check if you drop under a minimum balance of $100, but you can use another bank’s ATM without a fee. Bank B has free checking but charges $1.40 each time you use another bank’s ATM. Calculate the difference in fees between the two banks over the course of a year for the following scenarios. a. your balance slips below $100 every month b. Your balance slips below $100 every other month, but you are now able to pay a bill online each month, dropping the number of checks you have to write to fifteen monthly. You also find you are only using the other bank’s ATM about once a week. c. You maintain a minimum balance of $500, write nine checks a week, and use another bank’s ATM only about once a month.

Consider the following conditions:(a) In your new job you are paid each month, instead of weekly.(b) The rate of interest on bonds and other financial assets rises.(c) An automatic teller machine (ATM) is installed next door and you have a debit card.(d) Bond prices are expected to fall.Would you decide to increase or decrease your average holding of money (i.e. cash and/orcheque deposit balances)? Which of the three motives for holding money is involved in eachcase?

Let's say you showed your friend Cardi all these calculations, and she went, "Man, this is screwed up! Credit cards are a racket!" (Yes, Cardi, they are - if you don't pay your balance in full every month, that is.) But it's not all bad news, you tell Cardi. There is something she can do in order to reduce both her cost of borrowing and the length of time she'll be in debt. What can she do? (check all answers that apply) a. Ask her credit card company to shorten the duration of the loan. b. Make her payments earlier in the month rather than later. c. Transfer the balance to a lower interest card with another bank. d. Complain to the Consumer Financial Protection Bureau. e. Pay more than $400 every month. f. Ask her credit card company to lower the 29% interest rate. g. Occasionally make additional payments to the account.

Answer 2

Question

Chapter 5, Problem 7FPC

a

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The type of account is better for A to avoid or minimize fee on balance requirement of checking account.

Introduction:

Checking account balance requirements:Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800-$1,200 a service fee is applicable.

b

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The way A could work to avoid monthly fee of his account.

Checking account balance requirements: Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800 to $1,200 a service fee is applicable.

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Answer 3

Question

Chapter 5, Problem 7FPC

a

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The type of account is better for A to avoid or minimize fee on balance requirement of checking account.

Introduction:

Checking account balance requirements:Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800-$1,200 a service fee is applicable.

b

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The way A could work to avoid monthly fee of his account.

Checking account balance requirements: Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800 to $1,200 a service fee is applicable.

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Answer 4

Question

Chapter 5, Problem 7FPC

a

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The type of account is better for A to avoid or minimize fee on balance requirement of checking account.

Introduction:

Checking account balance requirements:Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800-$1,200 a service fee is applicable.

b

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The way A could work to avoid monthly fee of his account.

Checking account balance requirements: Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800 to $1,200 a service fee is applicable.

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Answer 5

Chapter 5, Problem 7FPC

a

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The type of account is better for A to avoid or minimize fee on balance requirement of checking account.

Introduction:

Checking account balance requirements:Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800-$1,200 a service fee is applicable.

b

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The way A could work to avoid monthly fee of his account.

Checking account balance requirements: Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800 to $1,200 a service fee is applicable.

Answer 6

Chapter 5, Problem 7FPC

a

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The type of account is better for A to avoid or minimize fee on balance requirement of checking account.

Introduction:

Checking account balance requirements:Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800-$1,200 a service fee is applicable.

Answer 7

Chapter 5, Problem 7FPC

a

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The type of account is better for A to avoid or minimize fee on balance requirement of checking account.

Introduction:

Checking account balance requirements:Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800-$1,200 a service fee is applicable.

Answer 8

b

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The way A could work to avoid monthly fee of his account.

Checking account balance requirements: Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800 to $1,200 a service fee is applicable.

Answer 9

b

Summary Introduction

Case summary: AS a service station owner, has tracked his high, low and average balances in his account. It is required to determine which type of account is better for him it can be seen that average balance account is better for him. How monthly fee can be avoided has been advised to him.

Characters in the case : AS

Adequate information: AS a service station owner considering changing his checking account, it is required to determine the type of checking account is suitable from the available options.

To determine: The way A could work to avoid monthly fee of his account.

Checking account balance requirements: Most interest-earning accounts have a minimum balance requirement that if not met, will result in the assessment of a monthly fee of around $10 to $25 a month and forfeiture of any interest earned for the month. Balance requirements are either based on minimum balance or average balance requirement. With a minimum balance account, customer must maintain a minimum balance which will be around $500 to $1,000 in account throughout a specified period usually a month or a quarter. With an average balance account, if the average daily balance drops below a pre stated level usually between $800 to $1,200 a service fee is applicable.

Answer 10

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Answer 13

Ch. 5.1 - Prob. 1CC Ch. 5.1 - Explain the circumstances when it would be...Ch. 5.1 - Prob. 3CC Ch. 5.1 - Summarize your insurance protections when you have...Ch. 5.2 - Explain why opening a checking account and a money...Ch. 5.2 - Prob. 2CC Ch. 5.2 - Prob. 3CC Ch. 5.2 - Prob. 4CC Ch. 5.3 - Prob. 1CC Ch. 5.3 - Prob. 2CC

Solution Summary: The author explains how a service station owner determines which type of checking account is better for him to minimize fees on balance requirements.

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