Uncertainty Is

question 1

Multiple Choice

Uncertainty is

• A) The ability to predict a future state using a probability distribution
• B) The state in which insufficient evidence exists to construct a probability distribution of the future outcome
• C) The inability to reach optimal decisions due to the inherent limitations of the human mind, incomplete information, and time constraints
• D) Non-socially optimal results driven by self-interested actions of individuals

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Definitions:

Prior Service Cost

Costs recognized when a pension plan is amended to increase benefits for employee service in prior periods, typically amortized over time.

Unrecognized Net Gain

A profit that has been realized but not yet recorded in the financial statements of a company.

Projected Benefit Obligation

The present value of estimated future pension benefits owed to employees, based on expected salary increases.

Prior Service Cost

Costs that arise when a pension plan is amended to increase benefits for employee service provided in prior periods, recognized over the service periods of affected employees.