Generally, a Qualified Plan Must Cover a Broad Spectrum of Employees

question 34

Multiple Choice

Generally, a qualified plan must cover a broad spectrum of employees on a nondiscriminatory basis. Specifically, the plan may qualify if it covers at a minimum:

• A) All full-time employees who are age 25 and over
• B) 70 percent of all nonhighly compensated employees
• C) All full-time employees over age 21 with at least three years of service
• D) All full-time employees earning in excess of the FICA limit

---

Definitions:

Arbitrage

The simultaneous purchase and sale of an asset in different markets to exploit price differences for a risk-free profit.

Treasury STRIPS

Separate Trading of Registered Interest and Principal of Securities; bonds that are dissected into individual principal and interest payments and sold separately.

Treasury Bond

A long-term government debt security with a fixed interest rate and maturity of more than ten years.

Treasury Bond

Long-term, fixed interest government debt securities with a maturity of more than ten years.