Question

You put $500 in an interest bearing bank account that pays 2% per year but has a fee of $2 per month. Are you getting ahead?

a)Yes b)No c)Can't tell

Answer 1

The answer is B

With 500 dollars, you would be making 10 dollars a year on that account, within 5 months the money you have gained will be take for the fee. Leaving 7 months left that you will be coming out of pocket 14 dollars.

Answer 2

The answer is b) No

2% of 500 is 10.
$10 interest per year.

There are 12 months in a year. $2 per month
2 * 12 = 24
$24 a year is the fee.

So, if you have a $10 interest per year, but are paying $24 per year on a fee, you are not getting ahead.


Hope this helps you! (:
-Hamilton1757