In Addition to Money Managers, Advisors Called Plan Sponsor Consultants

question 6

Multiple Choice

In addition to money managers, advisors called plan sponsor consultants provide other advisory services to pension plan sponsors. Which of the below is NOT a service that consultants provide to advisors?

• A) Consultants give general and comprehensive research
• B) Consultants give actuarial advice (liability modeling and forecasting)
• C) Consultants measure and monitor the performance of the fund's money managers
• D) Consultants search for and recommend money managers to pension plans

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Definitions:

Binomial Experiment

A statistical experiment that meets the criteria of having a fixed number of trials, each with two possible outcomes, independent trials, and a constant probability of success.

Independent Trials

Refers to experiments or processes in which the outcome of any given trial does not affect the outcomes of future or past trials.

Probability of Success

The likelihood of achieving a desired outcome or event.

Binomial Distribution

A probability distribution that represents the number of successes in a set number of independent binary (success/failure) experiments.