Respuesta :
25% of $10,000 is $2,500
But because they only match "up to $2,000," her employers contribution was $2,000
But because they only match "up to $2,000," her employers contribution was $2,000
We have been given that Catherine's employer matches 25% of her 401(k) contributions or a maximum of $2000. Further we are given that Catherine's salary is $50,000 and she contributed $10,000 to her 401(k) plan.
Let the contribution form her employer be $x. We are given that her employer matches 25% of Catherine's contribution under 401(k) plan. Therefore, contribution made by employer would be either 25% of 10,000 or 2000, whichever is lesser.
Let us find 25% of 10,000.
[tex]25\% \text{ of 10000 } = 10,000 \times \frac{25}{100} = \$2500[/tex]
Since 25% of 10,000 is more than 2000, therefore, Catherine's employer would make a contribution of $2000.
