Account\" 1. According to the presentation oth IRA ared to other long-term inves

Question

Account" 1. According to the presentation oth IRA ared to other long-term investments because account reduces your income tax liability in the year the is unique when comp personal investing a on on personal investing, a "Roth Individual Retirement Theis made.your account reduces vour income tax liability in the year the C) Your withdrawals from the not years old and you are age 59 ½ or older A) A contribution into contribution is made B) The earnings that are credited to your accou each year are not taxed account are not taxed as long as the account is at least five 2. A 401(k) is si nt matches your earnings on a dollar-for-dollar basis milar to a Traditional Individual Retirement Account (IRA) except that Re a Traditional IRA. B) The earnings that are but are taxed for a 401(k) C) Withdrawals from the 401(k) D) 401(k) accounts are IRAs are not. oyee contributions to a 401(k) whereas there is no match for ice redited to an account each year are not taxed for a Traditional IRA an account are not taxed for a Traditional IRA but are taxed for a not ways "socially-responsible investments" (SRI) whereas Traditional "socially-r Socially Responsible Investment (SRI) mutual funds do not distinguish themselves from conventional mutual funds (e.g, index funds) by: A) Charging lower management fees. B) Using negative screens to exclude investments in tobacco, alcohol or firearms. C) Using positive screens to include firms that pollute less, place more women in management or produce socially-beneficial products. D) Engaging in shareholder advocacy campaigns to influence the management decisions of multinational corporations. 4. The main advantage of investing in a certificate of deposit at a local bank instead of a mutual fund is A) The interest rate is much higher than the return in the stock market. B) The interest rate is much lower than the returm in the stock market. C) The certificate of deposit is insured by the federal govermment (FDIC) D) The mutual fund is insured by the federal government (FDIC) You may answer the following questions using the Excel Workbooks uploaded to Moodle "Future Value of a Lump Sum" and "Future Value of an Annual Amount").

Explanation / Answer

1.) The correct answer is A

A contribution into your account reduces your income tax liability in the year the contribution is made.

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