Which One of the Following Is True of Defined-Contribution Plans

question 29

Multiple Choice

Which one of the following is true of defined-contribution plans?

• A) They shift the investment risk to the employer.
• B) They present greater administrative challenges to employers.
• C) They require annual premium payments to the PBGC.
• D) They guarantee a basic benefit to the employee if the employer experiences financial difficulties.
• E) They are easier to administer as compared to other plans.

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Definitions:

Y-Intercept

The point at which a line crosses the y-axis in a Cartesian coordinate system.

Linear Regression

A statistical method used to model the relationship between a dependent variable and one or more independent variables by fitting a linear equation to observed data.

Predicted Value

An estimated value calculated within the context of a statistical model based on existing observations and variables.

Y-Intercept

The point where a line crosses the Y-axis in a graph or chart.