Which of the Following Statements Is TRUE of Cash Balance

question 35

Multiple Choice

Which of the following statements is TRUE of cash balance plans?

• A) The benefit grows slowly and provides an unpredictable benefit.
• B) The employer contributes a fixed percentage of workers' income to a hypothetical account and guarantees it will grow at a fixed rate.
• C) The use of cash balance plans increases the employer's pension liability and employers therefore avoid these plans.
• D) Under this plan, an employer provides health insurance to all the family members of the workers.

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