8
QuizMultiple Choice

Consumer Responsibilities

Question 8 • FL-2102371-Personal Finance and Money Management

Dwayne had a balance of $95.13 in his checking account on Monday morning. That day he used his debit card for the following transactions:Breakfast at the corner bagel shop: $8.53Gas in the car: $28.60Cable bill: $65.39Oil change: $30.64Dwayne's bank uses a balance system of debiting from highest to lowest. The bank will not return amounts up to a total of $50 in overdrafts, but they do charge a fee for each overdraft. How many overdraft fees will Dwayne incur?

Answer
A
1
B
2
C
3
D
4

Explanation

The bank debits the largest transactions first: $65.39, $30.64, $28.60, then $8.53. After the $65.39 cable bill, Dwayne has $29.74 left, which is not enough for any of the three remaining transactions. Each of those transactions creates an overdraft, and their combined shortfall is $38.03—within the bank’s $50 overdraft limit. So he incurs 3 fees; the correct choice is C, 3.

AI-written and checked against the verified answer.

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