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Suppose Bank Marginal currently has $250 million in regular savings deposits. The bank currently pays a 2.50% interest rate on savings. The bank estimates that
Suppose Bank Marginal currently has $250 million in regular savings deposits. The bank currently pays a 2.50% interest rate on savings. The bank estimates that if it raises the rate on savings deposits to 3.00%, its regular savings deposits would increase by $100 million. What would the marginal cost be for the additional funds raised? A) 2.50% B) 2.75% C) 3.00% D) 3.70% E) 4.25% F) 5.40%
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