Which Statement Explains the Risk Involved in "Defined Benefit Plans

question 21

Multiple Choice

Which statement explains the risk involved in "defined benefit plans"?

• A)The plan places investment risk on employees since the future benefits are pre-specified.
• B)The plan sponsor never needs to increase its contributions to the pension trust.
• C)The plan may require the employee to pay $200 per month for each year of service.
• D)The plan specifies the eventual outflows from the pension trust to future retirees.

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Definitions:

Capillaries

Tiny blood vessels that connect arteries and veins, facilitating the exchange of water, oxygen, carbon dioxide, and many other nutrients and waste substances between blood and tissues.

Mesenteric Vein

A vein that drains blood from the small intestine (and sometimes from the large intestine) into the portal vein of the liver.

Liver

An essential body organ that plays a crucial role in removing toxins, synthesizing proteins, and producing the biochemicals needed for digestion.

Intestines

The lower part of the digestive system where food is digested and absorbed into the body, comprised of the small and large intestines.