Which of the Following Plans Is Comparable to a Group

question 20

Multiple Choice

Which of the following plans is comparable to a group RRSP?

• A) mandatory benefits
• B) a defined benefit plan
• C) a defined contribution plan
• D) a tax-advantaged type of performance pay

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Definitions:

Compound Interest

This concept involves calculating interest on the original investment or loan amount, in addition to the interest that has compounded from past periods.

Cash Payback Period

The duration required for an investment to generate cash flows sufficient to recover the initial outlay, measuring the investment's liquidity or risk.

Annual Net Cash Flows

The amount of cash that a company generates or loses over a year after accounting for all cash inflows and outflows.

Cash Payback Period

The time duration required to recover the initial investment cost through the cash flows generated by the investment.