Commercial Applications
A bank offers the following options to its customers:
- Fixed Deposit Account: 7% interest, withdrawal only after maturity.
- Savings Account: 4% interest, withdrawal anytime.
- Recurring Deposit Account: 6% interest, regular monthly deposits.
Which account type should a customer choose if they need to withdraw money regularly and also want to maximize interest?
- Fixed Deposit Account
- Savings Account
- Recurring Deposit Account
- None of the above
Banking
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Answer
Savings Account
Reason — The customer's first requirement is regular withdrawals, which automatically rules out Fixed Deposit (only on maturity) and Recurring Deposit (also on maturity date). Among the remaining options, only the Savings Account permits withdrawals at any time. Although it offers a lower 4% interest, it is the only type that meets the primary requirement of regular withdrawals — so it is the best fit available.
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