Mr Paul, Age 73 and Single, Earned a $150,000 Salary

question 15

Multiple Choice

Mr. Paul, age 73 and single, earned a $150,000 salary as a university professor. He no longer participates in the university's qualified retirement plan. Which of the following is true?

• A) Mr. Paul can make a $6,000 deductible contribution to a traditional IRA.
• B) Mr. Paul can make a $6,000 nondeductible contribution to a traditional IRA.
• C) Mr. Paul can make a $6,000 nondeductible contribution to a Roth IRA.
• D) Mr. Paul can't make an IRA contribution.

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Definitions:

Expected Yield

The anticipated return on an investment, based on projections or historical data.

Coupon Payments

Coupon payments are periodic interest payments made by bond issuers to bondholders, typically based on the bond's face value and stated interest rate.

Par Value

The face value of a bond or the stock value stated in the corporate charter, often used as a bookkeeping figure rather than the market value.

Corporate Bonds

Debt securities issued by corporations to raise funding, which pay periodic interest payments to investors until the maturity date when the principal is repaid.