Carl, Age 44, Wants to Contribute the Maximum Allowed to a Roth

question 4

Multiple Choice

Carl, age 44, wants to contribute the maximum allowed to a Roth IRA.He is single and his AGI is $124,000.How much can he contribute to the Roth IRA?

• A)$6,000
• B)$5,200
• C)$2,000
• D)$800 AGI Phase-Out Ranges for 2019 IRAs
• \(\quad \)\(\quad \)\(\quad \)\(\quad \)\(\quad \)\(\quad \)\(\quad \)\(\quad \)\(\quad \)\(\quad \)\(\quad \)\(\text { Phase-out range }\)
• \(\begin{array}{lcc}
• \hline & \text { Single } & \text { Married filing jointly } \\
• \text { Traditional } & \$ 64,000-\$ 74,000 & \$ 103,000-\$ 123,000 \\
• \text { Roth } & \$ 122,000-\$ 137,000 & \$ 193,000-\$ 203,000
• \end{array}\)

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Definitions:

Long-Run

A time period in which all factors of production and costs are variable, allowing for the adjustment of all inputs.

Normal Profit

A rephrased definition: The minimum earning potential that keeps a firm operating in a competitive market, synonymous with break-even profitability.

Downward-Sloping Demand

A concept in economics that illustrates how the quantity demanded of a good decreases as its price increases, assuming all other factors remain constant.

Monopolistic Competitor

A market structure in which many firms sell products that are similar but not identical, allowing for competition on factors other than price.