Retirement Plan Deposits Calculation
How much will a self-employed person deposit in one year?
A self-employed person sets up a retirement plan in which he deposits $3600 every six months. What is the total amount he will deposit in one year?
1) 7200
2) 10800
3) 14400
4) 18000
Answer
The total amount a self-employed person will deposit in one year, given semiannual deposits of $3600, is $7200, by multiplying the semiannual amount by two. The correct option is (1).
The question presents a scenario where a self-employed individual is making deposits of $3600 into a retirement plan every six months. To calculate the total amount this person will deposit in one year, we need to consider the frequency of deposits.
Since the deposits are made every six months, in one year, there will be two such deposits. Therefore, by multiplying the semiannual deposit of $3600 by two, we get the total annual deposit amount of $7200.
Therefore, the correct answer to the total amount the self-employed person will deposit in one year is $7200.