One Benefit of a Simple IRA Is That It Allows

question 198

Multiple Choice

One benefit of a simple IRA is that it allows

• A) employees of small companies to save more than a regular IRA.
• B) employees to invest in the corporate bonds of their employers.
• C) business owners to use employee retirement funds to help finance their small business.
• D) employees to withdraw funds from the IRA prior to retirement without penalty.

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Definitions:

Allocation Efficient

A distribution of resources in which it is impossible to make any one individual better off without making at least one individual worse off.

Mutually Beneficial

A situation or agreement that provides advantages to all parties involved, ensuring that each gains from the interaction.

Transaction Costs

Expenses incurred when buying or selling a good or service, which can include fees, taxes, and other charges beyond the price of the product itself.

Complete Information

A state in which all participants in an economic transaction have full knowledge of the terms, conditions, and outcomes associated with the transaction.