At River Bank, checking account customers earn 0.75% interest a month on their account balances, pay no service fees for writing checks, and pay a monthly $2.00 financial charge. Calculate the income earned in one month on the checking account for a customer with an account balance of $1,000. (1 point) Responses $4.25 $4.25 $5.50 $5.50 $6.75 $6.75 $7.25

Answer 1

To calculate the income earned in one month on the checking account, we first calculate the interest earned and then subtract the financial charge.

1. Calculate the interest earned:
   Interest rate = 0.75% per month
   Account balance = $1,000

   Interest earned = Account balance × Interest rate
   Interest earned = $1,000 × 0.0075 = $7.50

2. Subtract the financial charge:
   Financial charge = $2.00

   Net income = Interest earned - Financial charge
   Net income = $7.50 - $2.00 = $5.50

Therefore, the income earned in one month on the checking account for a customer with an account balance of $1,000 is $5.50.