To Fund Social Security, a Portion of a Person's Earnings

question 19

Multiple Choice

To fund Social Security, a portion of a person's earnings are subject to a(n) ________ Social Security tax, half paid by the employee and half by the employer.

• A) 10.8 percent
• B) 12.4 percent
• C) 14.2 percent
• D) 18.6 percent
• E) 30 percent

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Definitions:

Warrants

Securities that give the holder the right, but not the obligation, to buy a company's stock at a predetermined price before a specified date.

Common Shares

Equity investments that represent ownership in a company, providing voting rights and potential dividends to shareholders.

Retained Earnings

The portion of a company's profits that is kept or retained and not paid out as dividends to shareholders.

Credit Card Receivables

The outstanding balances owed to a company from customers' credit card transactions, considered an asset.