An Employee Has an Average Wage of $60,000 and They

question 73

Multiple Choice

An employee has an average wage of $60,000 and they have worked for the firm for 25 years.The defined benefit pension plan pays retirees 2.5% of the average wage times the years of service.The employee can expect to receive _______ per year upon retirement.

• A) $18,000
• B) $37,500
• C) $45,325
• D) $55,250

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Definitions:

Annual Cost Savings

The reduction in costs achieved during a year due to various savings measures or efficiencies.

Discount Factor

A multiplier used in discounted cash flow (DCF) analyses to determine the present value of future cash flows, reflecting the time value of money.

Proposed Project

An outlined plan or proposal for undertaking a specific activity or achieving a goal that requires approval or funding.

Discount Rate

The rate used in discounted cash flow analysis for valuing future cash flows in today's monetary terms.