Financial service and Bank accounts

Financial service

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Bank accounts vary in respect to various charges and fees levied for services rendered. Critical questions to consider in choosing bank account should firstly review the bank policies. Minimum balance, which is the least amount, required at any time in the account should be considered in reference to the charge levied if the balance dips below the set amount. Service charges levied by the bank for provision of services. The amount varies with different banks both on a timely and amount basis. Charges levied with the use of ATM (automated teller machines). The charges to use of ATM services are also vital for consideration especially in context to the fee of using the bank ATM machines and using other banks ATM machines. Some banks also include a set number of transactions allowed for ATM services where an inclusive charge is levied in case the number of use exceeds the defined quota. Convenience is also important in choosing a bank account where aspects such as location and size of the bank benefit the account holder. Since am married, a joint account will suffice for meeting household bills. Joint accounts are co-owned hence stipulations dictated by the bank to terms of ownership are also important in choice of the bank.

Monthly fee=$5

Check processing =25 cents

19 checks per month

25 cents = $0.25

19×0.25=4.75

5+4.75=8.75

8.75×12=105

Annual cost = $105

Annual interest = 2.5% if exceed $750

$8 pm charge if below minimum balance

Average monthly balance =$815

Fail below $750 in 4 months

8 x 4 = $32 (fee charged)

Cost = $32

Principle=$4000

Rate=4%

Time=5years

Future value =?

Interest=?

Future value factor = 1.217

4000 x 1.217 = $ 4868

Future value = $4868

Interest =F.V-principle

4868-4000=868

Interest = $868

Principle=$4000 pa

Interest =4%

Time=5years

Future value annuity=?

Future value annuity factor= 5.416

4000 x 5.416 = 21664

Future value annuity = $21664

Short-term investment methods allow generating of revenue through investment characterized by a reduced period. They include small goals such as investing in the US savings bond since their maturity is quick and favours a short-term investment. Another investment vehicle is Federal Deposit Insurance Corporation since they allow a person access to funds without penalties.

Deficit simply means that the government is spending more than it is acquiring from taxes. Factors that lead to inflation attribute to exponential growth of the monitory base superseding that of amount of goods and services in the economy. Factors to consider include how the deficits are financed. If financed by the treasury then no inflation occurs but if financed by the bank’s intervention then there is a high possibility for inflation.