if an employee invests 5% of his pre - tax salary into a retirement plan, the company will match 25% of that…

if an employee invests 5% of his pre - tax salary into a retirement plan, the company will match 25% of that amount. how much will the company contribute to the plan if the employee earns $50,000 before taxes?\na $6,250\nb $2,500\nc $625\nd $250

if an employee invests 5% of his pre - tax salary into a retirement plan, the company will match 25% of that amount. how much will the company contribute to the plan if the employee earns $50,000 before taxes?\na $6,250\nb $2,500\nc $625\nd $250

Answer

Explanation:

Step1: Calculate employee's investment

The employee invests 5% of $50,000. So the employee's investment is $50000\times0.05 = 2500$.

Step2: Calculate company's contribution

The company matches 25% of the employee's investment. So the company's contribution is $2500\times0.25=625$.

Answer:

C. $625