Which of the Following Statements Characterizes Defined Benefit Plans

question 76

Multiple Choice

Which of the following statements characterizes defined benefit plans?

• A) They are comparatively simple in construction and raise few accounting issues for employers.
• B) Retirement benefits are based on the plan's benefit formula.
• C) Retirement benefits depend on how well pension fund assets have been managed.
• D) All of these.

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Definitions:

Elastic Supply

A situation where the quantity supplied changes significantly in response to changes in price.

Elastic Demand

A situation where the demand for a product or service significantly changes in response to a change in price.

Inelastic Supply

A situation where the quantity supplied of a good is not significantly affected by a change in price.

Elastic Demand

A market condition where the demand for a product is sensitive to price changes, meaning that a small change in price results in a large change in the quantity demanded.