Bank A charges a $2 fee each time a customer withdraws money from an out-of-network ATM. They also charge a $12 monthly service fee. If your withdrawals at out-of-network ATMs exceed $12, the monthly service fee is waived.

Question

Bank B does not charge a fee for withdrawing money from an out-of-network ATM, but instead charges a $20 monthly fee. Bank B also limits you to 10 free ATM withdrawals per month. After 10 ATM withdrawals, they automatically charge a one-time fee of $5, no matter how many ATM withdrawals you make.

You and a friend are on vacation. You bank with Bank A. You withdraw money from an out-of-network ATM 14 times. Your friend banks with Bank B. He withdraws money from an ATM 22 times.

Which statement below is true?

(1 point)
Responses

You paid $40 in bank fees. Your friend paid $25 in bank fees.
You paid $40 in bank fees. Your friend paid $25 in bank fees.

You paid $28 in bank fees. Your friend paid $25 in bank fees.
You paid $28 in bank fees. Your friend paid $25 in bank fees.

You paid $25 in bank fees. Your friend paid $28 in bank fees.
You paid $25 in bank fees. Your friend paid $28 in bank fees.

You paid $28 in bank fees. Your friend paid $30 in bank fees.

Answer 1

To determine the bank fees for both you and your friend, let's calculate the fees for each bank separately.

Calculating your fees with Bank A:

1. Monthly service fee: $12
2. Number of out-of-network ATM withdrawals: 14
3. Fee per withdrawal: $2

Since your withdrawals exceed $12 in fees, the monthly service fee is waived. Therefore, your total fee is solely based on the withdrawals:

Total withdrawal fees = 14 withdrawals * $2 = $28

So, you paid $28 in bank fees.

Calculating your friend's fees with Bank B:

1. Monthly service fee: $20
2. Number of ATM withdrawals: 22

Bank B allows 10 free withdrawals. Therefore:

• First 10 withdrawals: Free
• Remaining withdrawals: 22 - 10 = 12 withdrawals
• Fee for additional withdrawals after the 10th: $5 (one-time charge).

Total fees for your friend: Total fee = Monthly service fee + One-time charge for extra withdrawals = $20 + $5 = $25.

So, your friend paid $25 in bank fees.

Based on these calculations, the correct statement is: You paid $28 in bank fees. Your friend paid $25 in bank fees.