Question
David's salary is $29,512, and he makes 401K contributions. His company will match 100% of the amount he saves up to 6%. How much will his company contribute if he contributes 8% of his salary to his 401K? (1 point) $1,700.00 $1,770.72 $1,795.10 $1,825.75
Answers
GPT-4o mini
To determine how much David's company will contribute to his 401K based on his contributions, we need to calculate the maximum amount the company will match.
1. **David's Salary**: $29,512
2. **David's Contribution Rate**: 8%
3. **Company Match Rate**: 100% of contributions up to 6%
First, we calculate how much David will contribute to his 401K based on his salary and contribution rate:
\[
\text{David's Contribution} = \text{Salary} \times \text{Contribution Rate} = 29,512 \times 0.08 = 2,360.96
\]
Next, we calculate the maximum contribution that the company will match, which is based on 6% of David's salary:
\[
\text{Company Match} = \text{Salary} \times 0.06 = 29,512 \times 0.06 = 1,770.72
\]
Since David is contributing more than 6% of his salary, the company will only match the 6%, which is $1,770.72.
So, the amount that the company will contribute is:
\[
\text{Company's Contribution} = 1,770.72
\]
The correct answer is **$1,770.72**.
1. **David's Salary**: $29,512
2. **David's Contribution Rate**: 8%
3. **Company Match Rate**: 100% of contributions up to 6%
First, we calculate how much David will contribute to his 401K based on his salary and contribution rate:
\[
\text{David's Contribution} = \text{Salary} \times \text{Contribution Rate} = 29,512 \times 0.08 = 2,360.96
\]
Next, we calculate the maximum contribution that the company will match, which is based on 6% of David's salary:
\[
\text{Company Match} = \text{Salary} \times 0.06 = 29,512 \times 0.06 = 1,770.72
\]
Since David is contributing more than 6% of his salary, the company will only match the 6%, which is $1,770.72.
So, the amount that the company will contribute is:
\[
\text{Company's Contribution} = 1,770.72
\]
The correct answer is **$1,770.72**.