An FI Offers a $2,500 Minimum Balance Chequing Account Paying

Multiple Choice

An FI offers a $2,500 minimum balance chequing account paying 4 percent annual interest, and there are no service charges as long as the customer maintains the minimum balance. The customer maintains a balance of $5,000, and averages 750 cheques per year. Each cheque has a processing cost to the FI of $0.15. What is the annual gross interest return on this account to the customer?

A) $112.50.
B) $100.00.
C) $312.50.
D) $137.50.
E) $212.50.