What is the dollar cost average price over a 6 month period given the following information?
Annual Gross Salary = $50,000
Month 1, 2, 3 Annual Contribution Rate as a % of Gross Salary = 3.00%
Month 4, 5, 6 Annual Contribution Rate as a % of Gross Salary = 4.50%
* Monthly contributions are used to purchase a security based on the below prices.
Security Prices
Month Price
1 27.45
2 27.34
3 28.00
4 28.60
5 30.00
6 22.90
A. $27.38
B. $27.11
C. $10.42
D. $27.19
2. What is the maximum tax deferred amount that may be contributed to an employee's traditional 401K plan in 2016. In 2016, the employee is 55 years old and earned $52,000 in salary. His 401K plan allows maximum catch-up contributions. He has always contributed the maximum allowable amount each year.
A. $24,000
B. $53,000
C. $58,000
D. $59,000