Question

Sharon wants to open a checking account from which to pay bills. She wants online services, and a debit card, which both banks provide for free. Based upon past experience, she expects to accidentally overdraft the account 1 time per year, due to unexpected charges and miscommunications. She expects no 2nd copies of statements, and to use network ATMs 4 times per month with either bank. She has $3300 in an emergency savings account at First State Bank, and thinks that the balance will be enough to cover overdrafts in the future if automatic transfers are made when needed.

Based on the tables of fees, above, if Sharon chooses First State Bank, will it save her money over choosing Common Bank?
a.
No, Common Bank will save Sharon more money.
b.
Yes, First State Bank will save Sharon money.
c.
No, First State Bank and Common Bank would have the same costs for Sharon.
d.
No, costs cannot be estimated in advance, so this information cannot be used.

Answer 1

Sharon is comparing two banks - First state bank and Common bank

The table below is comparing both the banks.

We can see that the first state bank has a monthly fee of $4 while there is no such charge in common bank. The second thing is non sufficient funds which is less in common bank. Thirdly, the 2nd copy charges of the common bank is cheaper(though this is not needed by Sharon).The ATM usage charges of common bank is also cheaper.

Comparing everything we can say that option A is the answer.

Answer 2

(a)

Explanation:

Two banks: First state bank and common bank are compared in the table based on the prices of both the banks.

After observing, we come to the conclusion that holding a first state bank will charge a monthly fee of $4 whereas in common bank there is no monthly fee.

Secondly, non sufficient bonds are cheaper in common bank as compared to first state bank.

Also, 2nd back statement is charged as $7 and $ 3 for each transaction under first state bank and common bank respectively.

Hence common bank is cheaper. Therefore,(a) common bank will save Sharon more money.