In a Defined Benefit Plan the Differences Between Expected and Actual

question 13

Multiple Choice

In a defined benefit plan the differences between expected and actual returns on high quality bonds will lead to:

• A) any actuarial and investment risk moving from the employer to the employee.
• B) actuarial gains and losses.
• C) a change in the discount rate.
• D) none of the given answers.

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Definitions:

Central Limit Theorem

A theory stating that when samples are large enough, their mean will be approximately normally distributed, regardless of the population's distribution.

Standard Error

A statistical measure that quantifies the variability or dispersion of a sample statistic from the population parameter it estimates.

Population Distribution

A term that describes how the values of a variable are distributed across an entire population.

Sampling Distribution

The probability distribution of a given statistic based on a random sample.