Jamie Has Worked for ABC Printing for 5 Years

question 66

Multiple Choice

Jamie has worked for ABC Printing for 5 years. During this period, ABC Printing has contributed $25,000 to her noncontributory retirement plan. Assuming ABC uses cliff vesting, the longest period allowed, how much will Jamie be able to roll into an individual retirement account (IRA) if she leaves ABC Printing?

• A) $0
• B) $5,000
• C) $10,000
• D) $20,000
• E) $25,000

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Definitions:

Interest Rates

The proportion of a total amount of money levied for borrowing it, usually represented as an annual rate.

Pure Time Value

Pure time value is the concept in finance that money available now is worth more than the same amount in the future due to its potential earning capacity.

Term Structure

The relationship between interest rates (or yields) and different terms (or maturities) for debt securities.

Liquidity Premium

The additional return that investors require for holding securities with low liquidity, compensating them for the higher risk associated with difficulty in selling the asset quickly at its fair market value.