Which One of the Following Is a Retirement Plan That

question 106

Multiple Choice

Which one of the following is a retirement plan that allows a $5,500 annual contribution with tax-free earnings after five years?

• A)Roth IRA
• B)Education IRA
• C)Keogh Account
• D)401 Plan
• E)SEP

---

Definitions:

American Call Option

A financial derivative that gives the buyer the right, but not the obligation, to buy a security at a specified price within a certain time frame.

Exercise Price

The fixed price at which the holder of an options contract can buy (in the case of a call) or sell (in the case of a put) the underlying security or commodity.

ESOs

Employee Stock Options; rights granted to employees to purchase a company's stock at a predetermined price for a specific period.

Convertible Bond

A bond that can be exchanged for a fixed number of shares of stock for a specified amount of time.