The employees of a firm complain that they cannot afford to contribute $8,000 per year to a 401k because of the loss of $8,000 of take-home pay. In fact, how much will the take-home pay be reduced if all taxes combined total 33%?
A. $5,360
B. $6,340
C. $7,637
D. $8,000
A. $5,360
Take-home pay reduction = $8,000(1 - .33) = $5,360
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