For All Defined Contribution Plans, Funding Is Shared by the Employer

question 18

True/False

For all defined contribution plans, funding is shared by the employer and employee.

---

Definitions:

Implicit Cost

The opportunity cost associated with a firm's use of resources that it owns, which do not have a direct monetary payment but could generate income if deployed elsewhere.

Option

A financial derivative that gives the holder the right, but not the obligation, to buy or sell an asset at a specified price within a given timeframe.

Rate of Inflation

The percentage increase in the general price level of goods and services in an economy over a period of time.

Rate of Interest

The percentage at which interest is paid by a borrower for the use of money that they borrow from a lender.