Governments That Contribute to Single Employer and Agent Multiple-Employer Plans

question 5

Multiple Choice

Governments that contribute to single employer and agent multiple-employer plans compute annual pension cost as the _________?

• A) Annual required contribution.
• B) Normal cost.
• C) Unfunded actuarial liability.
• D) Net pension obligation.

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Definitions:

Loanable Funds

The money available for lending and borrowing in the financial markets.

Opportunity Cost

The value of the next best alternative foregone as the result of making a decision.

Downsloping

Refers to a descending trend or pattern, often used in contexts such as demand curves in economics, where price and quantity demanded move in opposite directions.

Nominal Interest Rate

The interest rate expressed in terms of annual amounts currently charged for interest and not adjusted for inflation.