Question

2. If the interest rate on a savings account is 0.02%, approximately how much money do you need to keep in this account for 1 year to earn enough interest to cover a single $9.99 Below-Minimum-Balance Fee? $5,000 $50 $500 $55,000

Answer 1

If the savings rate is 0.02%, we can easily solve for the amount of money needed to annually generate the amount to cover the $9.99 fee. We structure the equation as: $9.99 = 0.0002*B, where B is the balance. Dividing to solve for be, we get $49950, and the closest value to this of those given is $55,000.