Thomas Contributed $2,800 to a Roth IRA

question 72

Multiple Choice

Thomas contributed $2,800 to a Roth IRA. He is currently in the 25% tax bracket. How will his contribution affect his income tax for the current year?

• A) It will reduce the amount of taxes he owes in the current tax year by $700.
• B) It will increase the amount of taxes he owes in the current year by $700.
• C) It will reduce the amount of taxes he owes in the current year by $2,100.
• D) It will have no effect on the amount of taxes he owes this year.

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Definitions:

Pull Strategy

A marketing approach that aims to create demand for a product or service among consumers, encouraging them to request the product from retailers, who then order it from the supplier.

Speculation

The act of trading in an asset, or conducting a financial transaction, that has a significant risk of losing most or all of the initial outlay, in the expectation of a substantial gain.

Customization

The process of modifying a product or service to meet individual customers’ preferences or specific requirements.

Pull Strategy

A marketing approach that aims to create demand for a product or service and entice customers to actively seek it out, often through promotions and awareness campaigns.