Question

You make $85,000 per year and your company matches 50 cents for every dollar you deposit into your 401k plan, up to 8% of your salary. Complete parts (a) through (c) below.

(a) If you contribute $200 every month to your 401k, what will your company contribute each month?
The company will contribute $
(Type an integer or a decimal rounded to two decimal places as needed.)
(b) If you contribute $830 every month to your 401k, what will your company contribute each month?
The company will contribute $
(Type an integer or a decimal rounded to two decimal places as needed.)
(c) What is the maximum amount of money the company will contribute to your 401k each year?
The maximum amount that the company will contribute each year is $
(Type an integer or a decimal rounded to two decimal places as needed.)

Answer 1

To determine the company contribution, calculate 8% of your salary and divide it by 12. The company will contribute $566.67 each month for a $200 monthly contribution and $830 monthly contribution. The maximum annual company contribution is $81,600.

Step-by-step explanation:

To determine the amount the company will contribute each month, we need to calculate 8% of your salary. First, find 8% of $85,000:

8% × $85,000 = $<<0.08*85000=6800>>6,800

Now, divide this amount by 12 to find the monthly contribution:

$6,800 ÷ 12 = $<<6800/12=566.67>>566.67

Therefore, if you contribute $200 every month, your company will contribute $566.67 each month.

If you contribute $830 every month, the company will still contribute $566.67 each month because the company only matches up to 8% of your salary.

To find the maximum amount the company will contribute each year, multiply 8% of your salary by 12:

8% × $85,000 × 12 = $<<0.08*85000*12=81600>>81,600

Therefore, the maximum amount that the company will contribute each year is $81,600.

Answer 2

a) 100 $

b) 566,66 $

c) 566,66 $

Step-by-step explanation:

Mak 85,000 $ /per year, means 85000/12 per month that is 7083,33

8% of 7083,33 is 566,66 $ . Then

a) 200 < 566,33 then my company will contribute with 0,5*200 = 100 $

b) If I contribute with 830 $ ( 830 > 566,66 ) then my company will contribute with 566,66 $ the biggest amount

c) 566,66 s the maximm amount of money