Question

Connie has $660,000 she wants to save. If the FDIC insurance limit per

depositor, per bank, is $250,000, which of these ways of distributing her
money between three banks will guarantee that all of her money is insured?
O
A. $220,000 in bank A, $160,000 in bank B, $280,000 in bank C
O
B. $180,000 in bank A, $220,000 in bank B, $260,000 in bank C
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c. $220,000 in bank A, $300,000 in bank B, $140,000 in bank C
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D. $180,000 in bank A, $240,000 in bank B, $240,000 in bank C
SUBMIT

Answer 1

The answer would be D) $180,000 in bank A, $240,000 in bank B, $240,000 in bank C.

Explanation:

You can immediately eliminate A, B and C because the question clearly states that the limit per bank is $250,000.

Answer 2

D. $180,000 in bank A, $240,000 in bank B, $240,000 in bank C

Explanation:

She needs to deposit less than $250,000 in each bank in order to be able to have that sum of money insured, in this case she could deposit it this way:

$250,000

$250,000

$160,000

But that could be too risky and too on the verge of not being accepted, you she just takes $10,000 out of every $250,000 deposits to make them $240,00, and add it to the $160,000 deposit, so she is left with three deposits of:

$240,000

$240,000

$180,000

And with this she makes sure all of her deposits are insured by staying below the $250,000 limit.