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can you show steps and work please 5. Fine-Tuned Savings Association finds that it can attract the following amounts of deposits if it offers new
can you show steps and work please 5. Fine-Tuned Savings Association finds that it can attract the following amounts of deposits if it offers new depositors and those rolling over their maturing CDs at the interest rates indicated below: Expected Volume of New Rate of Interest Offered Deposits Depositors $10 million 2.00% 15 million 2.25 20 million 2.50 24 million 2.75 26 million 3.00 Management anticipates being able to invest any new deposits raised in loans yielding 5.50 percent. How far should this thrift institution go in raising its deposit interest rate in order to maximize total profits (excluding interest costs)? Rate Marginal Marginal Expected Total Interest Cost Offered on New Funds Marginal Cost Rate Interest Cost Inflows Exp. Diff. In Marg. Rev and Cost Revenue Rate. Total Profits Earned $10 2.00% 5.50% $0.3500 $15 2.25% 5.50% $20 2.50% 5.50% $24 2.75% 5.50% $26 3.00% 5.50%
can you show steps and work please
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