Edward Johnson Decided to Open Up a Roth IRA

question 87

Multiple Choice

Edward Johnson decided to open up a Roth IRA. He will invest $1,800 per year for the next 35 years. Deposits to the Roth IRA will be made via a $150 payroll deduction at the end of each month. Assume that Edward will earn 8.75% annual interest compounded monthly over the life of the IRA. How much will he have at the end of 35 years?

• A) $125,250
• B) $250,321
• C) $363,000
• D) $414,405

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Definitions:

Two-Factor Theory

A psychological theory proposing that emotional experiences arise from a combination of a state of physiological arousal and a cognitive interpretation of that arousal.

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