Corporate Employees Are Expected to Retire on Average in 25

question 61

Multiple Choice

Corporate employees are expected to retire on average in 25 years and to live 16 years after retiring.The pension plan's interest (discount) rate is 12% and the expected return on plan assets is 10%.Compute the PBO (Projected Benefit Obligation) if total annual benefits expected to be paid out to retirees is expected to be $210, 000.The following factors are available: $\begin{array}{ll}&10\%&12\%\\\text { Present value of an annuity for } 16 \text { years } & 7.824&6.974 \\\text { Present value of } \$ 1 \text { for } 25 \text { years } & .0923&.0589\end{array}$

• A)$ 86, 261
• B)$ 96, 775
• C)$135, 177
• D)$152, 653

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Definitions:

Norway

A Northern European country known for its high standard of living, extensive natural resources, and robust welfare system.

Competitive Spectrum

The range of competition levels across different markets or industries, highlighting the variations from monopolies to perfectly competitive markets.

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Cutthroat Competition

A market situation characterized by aggressive price cutting and marketing strategies among competitors aimed at gaining a larger market share.