A DI Offers a $500 Minimum Balance Account Paying 5

Multiple Choice

A DI offers a $500 minimum balance account paying 5.5 percent annual interest. The account has a service charge of $0.05 per cheque, and processing costs per cheque are $0.15. The customer maintains a balance of $1,000, and averages 150 cheques per year. What is the annual gross interest return on this account to the customer?

A) $22.50.
B) $70.00.
C) $15.00.
D) $55.00.
E) $7.50.