Question

Nathan has $300 to open a checking account. He wants an account with the lowest fees. He plans on using the ATM machine, and his employer offers direct deposit. Bank Account Terms and Conditions Bank A has a minimum balance of 500 dollars, interest of 0.1 percent, overdraft protection, 0 dollar ATM fee, and 0 dollar monthly fee. Bank B has a minimum balance of 250 dollars, interest of 0 percent, no overdraft protection, 0 dollars for all A B C bank A T M s, and 5 dollar monthly fee. Bank C has 50 dollar minimum balance, 0.1 percent interest, no overdraft protection, 2 dollar per A T M transaction, 10 dollar monthly fee or 0 dollars with direct deposit. Bank D has 100 dollar minimum balance, 0.1 percent interest, no overdraft protection, 0 dollar A T M fee, and 5 dollar monthly fee or 0 dollars with direct deposit. Which checking account would be best for Nathan?

Answer 1

Answer:

Checking Account with Bank D

Explanation:

Nathan's conditions for the checking account include

1. $300 available for the account opening (minimum balance)
2. lowest fees
3. Use of ATM machine
4. Direct deposit by his employer

Bank A will not be suitable because the minimum balance required by the bank ($500) is higher than Nathan's available funding ($300).

Bank B will not be suitable because it offers the same features on checking account with Bank D. But Bank D's checking account has an additional advantage of 0.1% interest (interest is zero for Bank B) and the possibility of zero monthly fee which will accrue from the direct deposit offered by Nathan's employer.

Bank C will not be suitable because it has a higher ATM fee ($2 per transaction vs. zero for Bank D).

Therefore Bank D's checking account is the best for Nathan.